|
| A quick look at the Commitment of Traders for soybeans indicates that producers are undersold for this time of year and both Managed Money and Other Reportables are lopsided to the short side.
In 2015 it was the other way, producers short, MM & OR's long.
In 2016, producers way short, MM & OR way long.
In 2017 producers moderately short, MM long, OR pretty even
In 2018 producers are modestly "undersold"?, MM & OR both very substantially short. And End Users uncharacteristically long.
I see two dangers here. Some End Users got some coverage early at lower prices which means they'll be less inclined to pay more later & as they eventually liquidate their positions they will need to sell, putting more sell pressure on the market.
But more importantly, given the usual routine where MM & OR's liquidate their position by swapping their shorts with producers trying to sell, they can just feed those shorts into the market as needed to suppress any tendency for the price to rise.
And then there's the bailout to consider. If it comes early enough will producers be inclined to just sell and call it good enough or they survive on the bailout and hold their beans? | |
|
What's it mean if ...
