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Funds post record selloff in CBOT soyoil as US supplies build -Braun

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The opinions expressed here are those of the author, a market analyst for Reuters.

By Karen Braun

NAPERVILLE, Illinois, April 21 (Reuters) -Large speculators have again adopted strongly bearish views in Chicago-traded soybean oil just a couple weeks after having quickly abandoned them, emphasizing the recent heaviness in global vegetable oil prices.

In the week ended April 16, money managers’ net short position in CBOT soybean oil futures and options surged to 53,295 contracts from 4,128 a week earlier, the largest weekly net selling in records back to 2006.

End users and other speculators were on the opposite side. Other reportable traders were net buyers of more than 19,000 soyoil futures and options contracts, a weekly record, and market participants such as merchants and processors were net buyers of almost 27,000 contracts, the most since late 2022.

Soybean oil futures BOv1 fell more than 5% in the week ended April 16, facing the sharpest slide yet this year. U.S. soyoil demand amid the recent renewable diesel push has been somewhat disappointing, and domestic soyoil stocks have risen to 10-month highs, surpassing analyst predictions.

Money managers’ recent moves in CBOT soybean meal reflect the unwinding of long oil-short meal positions. Soymeal futures SMv1 slightly weakened in the week ended April 16, though the managed money net short tumbled to 10,543 futures and options contracts from 24,072 a week earlier.

That marked funds’ least bearish meal view in three months. However, their net short in CBOT soybeans reached a six-week high on April 16, surging to 167,875 futures and options contracts from 139,310 a week earlier. New gross shorts accounted for much of the move.

CBOT soybeans Sv1 shed more than 2% that week as U.S. export demand continues to be overshadowed by Brazil’s soy harvest, which is expected to satisfy global demand despite differing crop size assumptions across the industry.

Money managers have held bearish views in CBOT soybean futures and options since the start of 2024. Those views have been the most bearish for the time of year since January, though they are tracking similarly to 2019, when funds’ net short bottomed in mid-May as U.S planting issues arose.

CBOT corn futures Cv1 were unchanged in the week ended April 16, though money managers were net sellers of the yellow grain for a fourth consecutive week, pushing their net short to 279,570 futures and options contracts from 263,554 a week earlier.

Money managers’ net short in CBOT wheat futures and options through April 16 reached the highest level since November, expanding by nearly 10,000 contracts on the week to 96,403 contracts. Their net short in Kansas City wheat futures and options in the same week rose to 49,231 contracts, also the largest since November.

CBOT wheat futures Wv1 jumped 2.5% on Friday over heightened tensions in the Middle East, and corn was up 1.6% as the U.S. Environmental Protection Agency said it will allow higher-ethanol blends of gasoline to be sold this summer, potentially supportive of corn demand.

CBOT July contracts of corn, soybeans and wheat were all up fractionally over the past three sessions and meal was up nearly 2%, though soyoil lost another 1% over that period, hitting contract lows on Friday.

Karen Braun is a market analyst for Reuters. Views expressed above are her own.

Graphic- Managed money net position in CBOT soybean oil futures and options https://tmsnrt.rs/3vTG0bw

Graphic- Managed money net position in CBOT soybean futures and options https://tmsnrt.rs/49H1BSl

Editing by Leslie Adler


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