Hedge funds bought a RECORD number of Cotton futures contracts last week (+26.5k contracts). That's a billion-dollar bet on higher prices. Cotton still looks cheap below 70 cents/lb. Crude Oil is pulling capital into ags. Is Cotton next? 🛢️🌿
Peak Trading Research
@peaktrading
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Quantitative commodity research.
Hedge funds are the LONGEST in ag futures since July 2023. $19.2B net long. 📈 Energy is the engine, and speculators are positioned for higher prices across the agriculture complex. 🌽🛢️
The MONEY FLOW event is real. 📈 Funds have bought #agriculture futures in 8 of 9 weeks. Crude Oil is the driver - forcing traders to reprice correlations, trade flows, and input costs across the entire complex. 🌽🛢️
Corn, Crude, Cotton, Canola! 📈 Hedge funds bought #ag futures for the sixth straight week. Record short covering in Cotton. Crude is the driver. The money flow event continues. 🛢️
🌾#Ags This Week: Funds know Crude Oil above $100 points to higher Grain prices. 🛢️ Specs have bought ag futures 7 of the past 8 weeks 📈 and last week they added a record +87k new Corn longs. Seasonals turn more bullish into April. Watching this week: U.S.-China trade talks begin in Paris today; Fed decision and Powell press conference Wednesday. Does Powell blink on cuts given new inflation pressures? 🏛️
In the past 20 years, there have been 57 trading sessions when Crude Oil closed right near $100/bbl. 🛢️ On those days, Corn averaged $6.00/bu. Today: $4.67. That's a 22% discount. Last week, funds added a record +87k contracts of new Corn longs. They know this math. 🌽
In the past 20 years, there have been 57 trading sessions when Crude Oil closed right near $100/bbl. On those days, Chicago Wheat averaged $8.07/bu. Today: $6.14. That's a 24% discount. Hedge funds know this math. 🌾🛢️
Managed Money hedge fund traders added RECORD long bets in Corn last week (+87k contracts). 🌽📈
Funds are running the math on what $100 Crude Oil means for Grain and Oilseed prices. 🛢️
Speculators are betting higher energy prices will push Grain prices higher in the months ahead via stronger biofuel economics, rising input costs, and uncertain global trade flows. 💰🚜🌾
The MONEY FLOW event for #agriculture futures continues. 🌾📈
Funds have now bought ags in 7 of the past 8 weeks, and Managed Money added RECORD longs across the ag complex last week (+149k contracts). 💰🚜
Crude > $100 is pulling #macro capital into Grains and Oilseeds. 🛢️🌽🌱
🌾 #AgsThisWeek: Crude is in the driver’s seat. 🛢️ Brent surged +27% last week, pulling commodities higher (BCOM +8.8%, BCOMAg +3.3%) as hedge funds piled into futures. 📈 Weak U.S. jobs data should cap the dollar, while CPI and the low-impact March WASDE arrive this week ahead of next week’s Fed meeting. 🌱 🚜
