Key facts
- AgResource Company reports wheat market stabilization.
- Funds maintain a sizable short position in wheat.
- US winter wheat harvest is expected to bring seasonal supply pressure.
- Wheat market must ration export demand via forward market premiums.
- Managed money sold 187,515 contracts across 10 key ag markets.
- Fund net long position decreased to 647,853 contracts.
AgResource Company has observed that the wheat market is the first of the major agricultural markets to stabilize. The firm anticipates the US winter wheat harvest will proceed and pass quickly, bringing seasonal supply pressure. Unlike corn, the wheat market will need to ration forward export demand by maintaining a premium to forward markets. AgResource also notes that funds hold a sizable short position in wheat. The latest Commitment of Traders report indicated substantial managed money selling across agricultural markets, with funds liquidating 187,515 contracts across 10 key agricultural markets. This activity reduced the fund net long position to 647,853 contracts, reflecting a liquidation of nearly 467,000 contracts in the past week. Separately, the CRB index closed lower as energy and commodity prices declined amid speculative selling, influenced by traders' fatigue with the US-Iran conflict.