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

By Karen Braun

NAPERVILLE, Illinois, March 30 (Reuters) - Global grain stocks are not exactly abundant, but speculators are quickly losing confidence in their bullish Chicago corn bets as trade tariffs and massive U.S. corn plantings loom.

In the week ended March 25, money managers cut their net long position in CBOT corn futures and options to 74,607 contracts from 107,270 a week earlier, establishing their least bullish view since early November.

Over the latest five weeks, money managers slashed their corn net long by nearly 280,000 contracts. Prior to this year, the largest five-week selloff from a similarly bullish position was 170,000 between September and October 2011.

While the recent reduction owed largely to exiting longs, new short positions were more prominent in the latest two weeks, particularly in the latest one. This suggests increasing comfortability in a short speculative corn stance.

However, corn futures have already weakened significantly. Most-active CBOT corn Cv1 on Friday bottomed at $4.42 per bushel, its lowest since December, before finishing at $4.53-1/4. That is well off February’s high of $5.13-3/4.

CBOT wheat Wv1 has also made a sharp downturn, on Friday reaching the lowest levels since July 31 before settling at $5.28-1/4 per bushel.

Money managers extended their net short in CBOT wheat futures and options through March 25 to an eight-week high of 92,587 contracts, up from 80,668 in the prior week. Funds have not been bullish Chicago wheat since June 2022.

SOYBEANS AND BEYOND

In CBOT soybeans, money managers established their most bearish position in three months, lifting their net short to 42,959 futures and options contracts through March 25 from 22,005 a week earlier.

They were also considerable sellers in the soybean products, increasing their net short in CBOT soybean meal to 84,050 contracts from 61,013 in the prior week. Funds boosted their net short in CBOT soybean oil to a six-month high of 44,618 contracts from 27,609 a week earlier.

The latter move may have stung late last week, as CBOT soybean oil futures BOv1 jumped nearly 6% on Thursday and Friday, reaching a one-month high. This came amid potential movement on U.S. biofuel policy, which has been stalled out in the last couple years.

Soybeans also rose late last week in sympathy, reaching two-week highs on Friday. Brazil is in the late harvest stages of a record soybean crop, but the market’s attention will turn to U.S. planting intentions and grain stocks from the U.S. Department of Agriculture on Monday.

Analysts expect a significant drop in U.S. soy acres from last year and a comparable gain in corn acres. However, some folks are bracing for an even bigger corn area than the average trade guess of 94.361 million acres, which could produce a relatively small soy number.

U.S. corn and soy ending stock estimates for 2024-25 have drifted lower in recent months on strong demand and smaller crops. These will be put to the test in Monday’s stock survey, which will mark inventory levels at the marketing year’s midway point.

Although these USDA reports are known to jolt markets, the April 2 deadline for reciprocal tariffs on U.S. trade partners could steal the week’s spotlight.

U.S. President Donald Trump has dubbed Wednesday as “liberation day” for the U.S. economy. However, it might not feel too freeing for U.S. agricultural markets, since escalating trade conflicts were the primary catalyst for the steep price dive a month ago.

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

(Editing by Diane Craft)

((karen.braun@thomsonreuters.com; X: @kannbwx))