05/30/25 Afternoon CommStock Report – Precedence for Contra-Seasonal Grain Price Strength

Commodity trading funds have flipped their holdings in corn futures and options to net-short for the first time since October. The net-short of more than 100,000 contracts formed from a net-long in early February that reached 364,000 contracts. Commercial hedgers have simultaneously closed out of a substantial net-short position that was built on farmers selling more aggressively when prices were higher in the winter and again in early April. The combination of speculative liquidation and commercial buyers having a lack of need for immediate coverage has weighed heavily on the old-crop contracts.   Speculators have also attempted to front run the seasonal downtrend that is known to usually occur at the start of summer.   Seasonal history shows corn and soybean futures most often making highs in June, although the top came in May last year. This year’s highs were made in February and the lower trend from there has now negated the seasonal price strength normally counted on during the spring. Summers usually see grain prices sliding lower as comfort rises about crop production potential. Still, there is some precedence for prices to rise counter seasonally in June and July. Consider the factors that sparked summer rallies in past years…