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3 Big Things Today, April 1

Soybeans, Corn Higher Overnight; Net-Short Positions Decline Across the Board.

1. Soybeans, Corn Rise Overnight on Bargain Hunting

Soybeans and corn were higher in overnight trading as bargain hunters snap up contracts after Friday’s losses.

Bean futures on Friday dropped by more than 5¢, while corn plunged more than 17¢. The declines came after the USDA said March 1 stockpiles of soybeans hit the highest-ever while corn inventories were at their third-highest level on record.

A separate report showed U.S. farmers are expected to increase corn acreage this year while lowering soybean seedings.

Wheat futures fell more than 6¢ on Friday.

Hedgers and investors seeking a bargain became buyers overnight, partly on optimism that the U.S. and China will be able to finalize an agreement on a trade deal after months of negotiations.

Chinese Vice Premier Liu He is expected in Washington to continue talks this week after a U.S. delegation that included Trade Representative Robert Lighthizer last week went to Beijing.

Soybeans for May delivery rose 5¾¢ to $8.90 a bushel overnight on the Chicago Board of Trade. Soy meal gained $1.10 to $307.60 a short ton, and soy oil added 0.14¢ to 28.50¢ a pound.

Corn futures added 4¢ to $3.60½ a bushel in Chicago.

Wheat futures for May delivery gained 2¢ to $4.59¾ a bushel overnight, while Kansas City wheat rose ¼¢ to $4.30¼ a bushel.


2. Speculative Investors Reduce Net-Short Positions in Corn, Beans

Money managers reduced their net-short positions, or bets on lower prices, in corn and soybeans in the week that ended on March 26, according to the Commodity Futures Trading Commission.

Speculators held 218,427 net-short positions in corn futures last week, down from 282,845 futures contracts seven days earlier, the CFTC said. That was the second straight decline.

Investors were net short by 47,700 soybean futures contracts as of March 26, down from 62,204 contracts the previous week. That also was a three-week low, according to the government.

Fund managers and other large investors have become less bearish on corn and beans in the past few weeks amid optimism that the U.S. and China will eventually be able to hammer out a trade agreement, though talks have been dragging on for months.

In wheat, speculators held 49,570 net-short positions in hard red winter futures, down from 52,693 contracts, the CFTC said.

Investors were net short by 64,550 soft red winter wheat futures contracts as of last week, down from 78,699 contracts seven days earlier. That’s the smallest such position in soft red winter wheat since February 26, government data show.

The Weekly Commitment of Traders Report from the Commodity Futures Trading Commission shows trader positions in futures markets.

The report provides positions held by commercial traders, or those using futures to hedge their physical assets; noncommercial traders, or money managers (also called large speculators); and nonreportables, or small speculators.

A net-long position indicates more traders are betting on higher prices, while a net-short position means more are betting futures will decline.


3. Freeze Warning in Effect From Oklahoma to West Virginia, Arkansas Crop Only 1% Headed  

A freeze warning is in effect for a wide stretch of land from northeastern Oklahoma into West Virginia, according to the National Weather Service.

Most of Arkansas and several counties in Oklahoma likely saw freezing or near-freezing weather overnight, the NWS said in a report early this morning. The freeze warning in the area is in effect until 9 a.m. local time.

“Near or subfreezing temperatures could damage crops or other sensitive vegetations,” the agency said in its report.

The good news for Arkansas is that the winter wheat crop in the state was only 1% headed as of March 24, according to the USDA. Still, 34% of the state’s crop was rated poor or very poor as of last week, while 32% was considered good or excellent, the USDA said in a report.

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