US wheat shorts as corn turns net short

Speculators in the Chicago wheat market, the biggest of the three, increased the net short to the highest level since May 2023. The net short position in the Kansas wheat market jumped to the highest level in data going back to September 2017, and the Minneapolis net short also rose.

The three US wheat contracts declined during the period as rainy weather in much of the Great Plains bolstered optimism about the health of the maturing winter wheat crop.

USDA projections and their impact on prices

Wheat prices came under additional pressure after the USDA projected that US wheat ending stocks and demand will climb in the 2025/26 marketing year, while output and exports are expected to fall, in the World Agricultural Supply and Demand Estimates report released on Monday May 12. The USDA also projected that global production, ending stocks, trade and demand will increase in 2025/26.

Corn futures also declined as US planting progressed at a robust pace. Production is expected to jump to a record high in 2025/26, according to the May WASDE.

Soybean market activity and trade developments

Meanwhile, soybean futures increased due to the announcement that the US and China reached a trade agreement to reduce import tariffs for a 90-day period. Prices also jumped because the WASDE projected lower-than-expected ending stocks for the US in both the 2024/25 and 2025/26 marketing years.

Managed money investors in the soybean market trimmed short positions by 2,958 lots, bringing the total to 84,787 lots. Soybean long positions rose by 13,579 lots to 123,194 lots, a 14-week high.

The decline in shorts, coupled with the gain in longs, resulted in the net long rising by 16,537 lots to 38,407 lots, a 14-week high. The soybean oil net long increased by 10,694 lots to 67,432 lots, a 26-week high.

Meanwhile, the soybean meal net short decreased by 712 lots to 102,745 lots in the week ended May 13, the highest net short in data going back to September 2017.

Changes in long and short positions across key markets

In the corn market, speculators bolstered short positions by 53,662 lots in the week to Tuesday, bringing the total to 258,073 lots, a 28-week high.

Long positions dropped by 45,207 lots from the prior week to 173,097 lots, a 40-week low.

The tremendous gain in shorts, coupled with the large decrease in longs, resulted in the market moving from a net long of 13,893 in the week ended May 6 to a net short of 84,976 on May 13. It is the biggest net short in 30 weeks.

Investors in the Minneapolis wheat contract increased short positions by 2,430 lots to 35,926 lots. The number of long positions slipped by 1,963 lots to 8,407 lots, a 28-week low. This led to the net short position rising by 4,393 lots to 27,519 lots.

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