USDA report vs. fund holdings: The long and short game between corn, soybeans and wheat, who is leading the countdown to the breakout?
2025-07-02 10:09:27
On Wednesday (July 2), the Chicago Board of Trade (CBOT) grain market showed a divergent trend at the beginning of this week, with trader sentiment fluctuating significantly under the influence of recent position changes and fundamental news. On July 1, CBOT soybean futures rose slightly, and the rise in soybean oil boosted the market, but soybean meal was under pressure to fall due to loose supply; corn futures fell to the contract low due to good crop growth and abundant supply expectations; wheat rebounded to a one-week high due to bargain hunting support. Position data showed that commodity funds turned net long on soybeans, wheat, soybean meal and soybean oil in the past five trading days, while corn turned net short, reflecting the market's divergent expectations for the prospects of each variety. The latest report and weather forecast from the U.S. Department of Agriculture (USDA) further provided guidance to the market, while international trading dynamics and policy changes also had a profound impact on prices. Based on the latest data, this article will analyze the impact of position changes, market sentiment and fundamentals on CBOT corn, soybeans, wheat, soybean oil and soybean meal, and look forward to future trends.
According to observations, the results estimated by overseas traders show:
On July 1, 2025, commodity funds:
Increase CBOT corn speculative net long position; increase CBOT soybean speculative net short position; increase CBOT wheat speculative net long position; increase CBOT soybean meal speculative net short position; increase CBOT soybean oil speculative net long position.
In the past five trading days, commodity funds:
Increase CBOT corn speculative net short; increase CBOT soybean speculative net long; increase CBOT wheat speculative net long; increase CBOT soybean meal speculative net long; increase CBOT soybean oil speculative net long;
In the latest 30 trading days, commodity funds:
Increase CBOT corn speculative net short position; increase CBOT soybean speculative net long position; increase CBOT wheat speculative net long position; increase CBOT soybean meal speculative net short position; increase CBOT soybean oil speculative net long position.
See the chart for specific change data.
Fundamental analysis: The weather outlook for the next 6-10 days in the main corn-producing states in the United States shows that the temperature in 61.11% of the areas is higher than normal, and the precipitation in 100% of the areas is higher than normal. This warm and humid weather is conducive to corn entering the critical pollination period. The USDA report on Monday showed that the US corn crop condition is the best since the same period in 2018, further consolidating the expectation of a bumper harvest. The USDA expects corn stocks to be 4.651 billion bushels on June 1, lower than 4.997 billion bushels in the same period last year, but still reflects ample supply. In addition, the latest tax bill of the US Senate proposes to prohibit the application of 45Z tax credits for biofuels produced from raw materials outside North America. If passed, it will benefit domestic corn growers in the United States and indirectly support corn demand. However, the sluggish futures prices have suppressed farmers' willingness to sell grain. The spot basis in Illinois and Ohio and other places has remained stable or slightly increased. For example, the basis of Chicago corn processing plants is reported at +22 cents/bushel, reflecting the reluctance to sell in the spot market.
Position changes and sentiment: On July 1, commodity funds increased their net long positions in corn by 4,000 lots, but turned to net short positions of 2,500 lots in the past five trading days, with a total net short position of 77,100 lots in 30 trading days, indicating that speculative funds are cautious about the outlook for corn prices. This bearish sentiment is mainly due to expectations of bumper harvests and the lack of new demand drivers. Although there has been no significant weakening in the demand for US corn exports recently, global supply is abundant, especially Ukraine's agricultural exports in June fell 23.8% to 3.4 million tons, indicating intensified competition in the international market. Market sentiment is constrained by the balance of supply and demand, and lacks momentum for an upward breakthrough in the short term.
Trend forecast: On Tuesday, September corn futures (CU25) closed down 3.25 cents to $4.06/bushel, hitting an intraday low of $4.0025/bushel. Supply pressure and good weather forecasts will continue to limit price upside, but a stronger basis and farmers' reluctance to sell may provide bottom support for the market. In the short term, corn futures may fluctuate in the range of $4.00-4.20/bushel, and attention should be paid to the subsequent inventory and export data of USDA.
Fundamental analysis: CBOT soybean futures rose slightly on Tuesday, with August soybeans (SQ25) closing at $10.2975 per bushel, essentially unchanged. The 1.8% rise in soybean oil prices became the main support, stemming from the 45Z tax credit bill passed by the U.S. Senate, which incentivizes renewable diesel and biofuel projects and restricts imported raw materials, significantly benefiting domestic soybean oil and soybean growers in the United States. USDA May crushing data showed that soybean crushing reached 203.7 million bushels, slightly lower than expected but a record high for the same period, with annual cumulative crushing of 1.844 billion bushels, far exceeding the same period last year. However, good crop growth and favorable weather (100% of the main producing states had higher precipitation than normal) limited the upside of prices. In the international market, the EU's soybean meal imports in 2024/25 increased to 19.25 million tons, but U.S. soybeans faced low-price competition from South America. India's soybean planting area is expected to decrease by 5%, which may provide some support for global supply.
Position changes and sentiment: On July 1, commodity funds increased their net short positions in soybeans by 2,000 lots, but turned to net long positions of 7,000 lots in the past five trading days, and accumulated net long positions of 6,500 lots in 30 trading days, indicating that market sentiment has shifted from cautious to moderately bullish. Speculative funds' optimistic expectations for the demand outlook for soybean oil have driven long positions, but ample supply and export competition have limited the sustainability of bullish sentiment. In terms of basis, the spot basis in Illinois and Ohio has improved slightly, such as the Decatur soybean basis of +20 cents/bushel, reflecting the spot market's expectations for favorable policies.
Trend forecast: In the short term, soybean futures are supported by soybean oil demand and favorable policies, but bumper harvest expectations and weak exports pose resistance. August soybean futures may fluctuate in a narrow range of $10.20-10.50 per bushel, and attention should be paid to the progress of the bill and South American export trends.
Fundamental analysis: CBOT wheat futures rose to a one-week high on Wednesday, with September Chicago soft red winter wheat (ZW1!) rising 0.1% to $5.495 per bushel, after hitting its highest point since June 25. Bargain buying and short covering were the main drivers, with the market attracting bargain-buying after hitting a multi-year low in May. However, pressure from a bumper harvest in the northern hemisphere limited the upside, with new-season wheat from the United States and Russia entering the market. The USDA expects U.S. wheat stocks to be 836 million bushels on June 1, lower than the same period last year, reflecting a certain degree of supply tightening. The situation in Russia and Ukraine caused Ukraine's agricultural exports to fall 23.8% in June, which had a certain impact on global wheat supply. In terms of basis, the Chicago wheat basis was -10 cents per bushel, a slight improvement from the previous value, indicating cautious optimism in the spot market.
Position changes and sentiment: On July 1, commodity funds increased their net long position in wheat by 3,500 lots, with a net long position of 7,500 lots in the past five trading days and a cumulative net long position of 1,000 lots in 30 trading days, indicating that speculative funds have turned mildly bullish on the outlook for wheat. This sentiment shift is related to the recent bottoming of prices and short covering, but ample global supply has suppressed bullish enthusiasm. Traders' attention to the situation in Russia and Ukraine has also injected uncertainty into the market.
Trend forecast: Wheat futures are supported by bargain hunting in the short term, but the pressure of a good harvest and a strong dollar may limit the rise. September wheat futures may consolidate in the range of US$5.40-5.60 per bushel, and attention should be paid to global export data and weather changes.
Fundamental analysis: CBOT soybean oil futures rose 1.8% on Tuesday, boosted by the 45Z tax credit bill, which, if passed, will significantly stimulate domestic soybean oil demand in the United States. USDA data showed that U.S. soybean oil stocks fell to 1.875 billion pounds at the end of May, down from 1.976 billion pounds in April and 2.188 billion pounds in the same period last year, reflecting growing demand and tightening supply. Stronger global vegetable oil prices, such as Malaysian palm oil futures hitting a more than two-year high, also provided support for soybean oil. Basis data has not been updated yet, but the spot market has responded positively to the policy benefits, and the basis is expected to strengthen further.
Position changes and sentiment: On July 1, commodity funds increased their net long positions in soybean oil by 5,000 lots, with a net long position of 4,000 lots in the past five trading days and a cumulative net long position of 25,500 lots in 30 trading days, indicating that speculative funds are highly bullish on the prospects of soybean oil. This sentiment is driven by favorable policies and declining inventories, and traders expect that demand for biofuels will continue to push up prices.
Trend forecast: Supported by policies and demand, soybean oil futures still have room to rise in the short term and may test recent highs. It is necessary to pay attention to the final passage of the bill and the dynamics of the global vegetable oil market.
Fundamental analysis: CBOT soybean meal futures fell 0.6% on Tuesday due to weak exports and loose supply pressure. USDA data showed that US soybean meal stocks increased to 407,000 short tons at the end of May, up from 390,000 short tons in April, reflecting supply growth. Although soybean oil demand has pushed up crushing profits, oil mills have increased crushing volume, leading to further easing of soybean meal supply. The EU's soybean meal imports in 2024/25 increased to 19.25 million tons, but US soybean meal faces low-price competition from South America and lacks price competitiveness. The stability of domestic pig stocks provides some support for demand, but short-term supply pressures dominate.
Position changes and sentiment: On July 1, commodity funds increased their net short positions in soybean meal by 1,000 lots, but turned to a net long position of 4,500 lots in the past five trading days, with a cumulative net short position of 20,500 lots in 30 trading days, indicating that market sentiment has improved in the short term but is generally bearish. Traders' concerns about oversupply dominate the market, but favorable policies may provide bottom support for prices.
Trend forecast: In the short term, soybean meal futures are limited by supply pressure and may fluctuate weakly at the current level. In the medium and long term, attention should be paid to policy progress and changes in export demand.
The short-term trend of the CBOT grain market is divergent. Corn is suppressed by the expectation of a bumper harvest, and the futures may be consolidated in the range of 4.00-4.20 US dollars per bushel; soybeans are supported by the demand for soybean oil and favorable policies, and the August futures may fluctuate between 10.20-10.50 US dollars per bushel; wheat rebounded due to bargain hunting, but the pressure of a bumper harvest limited the increase, and the September futures may be consolidated at 5.40-5.60 US dollars per bushel; soybean oil is driven by policies and demand, and there is still upward potential in the short term; soybean meal is weak and volatile due to loose supply. Traders need to pay close attention to the USDA inventory report, weather changes and international export trends to grasp the market direction.
According to observations, the results estimated by overseas traders show:
On July 1, 2025, commodity funds:
Increase CBOT corn speculative net long position; increase CBOT soybean speculative net short position; increase CBOT wheat speculative net long position; increase CBOT soybean meal speculative net short position; increase CBOT soybean oil speculative net long position.
In the past five trading days, commodity funds:
Increase CBOT corn speculative net short; increase CBOT soybean speculative net long; increase CBOT wheat speculative net long; increase CBOT soybean meal speculative net long; increase CBOT soybean oil speculative net long;
In the latest 30 trading days, commodity funds:
Increase CBOT corn speculative net short position; increase CBOT soybean speculative net long position; increase CBOT wheat speculative net long position; increase CBOT soybean meal speculative net short position; increase CBOT soybean oil speculative net long position.
See the chart for specific change data.
Corn: Supply expectations dominate, bearish sentiment heats up
Fundamental analysis: The weather outlook for the next 6-10 days in the main corn-producing states in the United States shows that the temperature in 61.11% of the areas is higher than normal, and the precipitation in 100% of the areas is higher than normal. This warm and humid weather is conducive to corn entering the critical pollination period. The USDA report on Monday showed that the US corn crop condition is the best since the same period in 2018, further consolidating the expectation of a bumper harvest. The USDA expects corn stocks to be 4.651 billion bushels on June 1, lower than 4.997 billion bushels in the same period last year, but still reflects ample supply. In addition, the latest tax bill of the US Senate proposes to prohibit the application of 45Z tax credits for biofuels produced from raw materials outside North America. If passed, it will benefit domestic corn growers in the United States and indirectly support corn demand. However, the sluggish futures prices have suppressed farmers' willingness to sell grain. The spot basis in Illinois and Ohio and other places has remained stable or slightly increased. For example, the basis of Chicago corn processing plants is reported at +22 cents/bushel, reflecting the reluctance to sell in the spot market.
Position changes and sentiment: On July 1, commodity funds increased their net long positions in corn by 4,000 lots, but turned to net short positions of 2,500 lots in the past five trading days, with a total net short position of 77,100 lots in 30 trading days, indicating that speculative funds are cautious about the outlook for corn prices. This bearish sentiment is mainly due to expectations of bumper harvests and the lack of new demand drivers. Although there has been no significant weakening in the demand for US corn exports recently, global supply is abundant, especially Ukraine's agricultural exports in June fell 23.8% to 3.4 million tons, indicating intensified competition in the international market. Market sentiment is constrained by the balance of supply and demand, and lacks momentum for an upward breakthrough in the short term.
Trend forecast: On Tuesday, September corn futures (CU25) closed down 3.25 cents to $4.06/bushel, hitting an intraday low of $4.0025/bushel. Supply pressure and good weather forecasts will continue to limit price upside, but a stronger basis and farmers' reluctance to sell may provide bottom support for the market. In the short term, corn futures may fluctuate in the range of $4.00-4.20/bushel, and attention should be paid to the subsequent inventory and export data of USDA.
Soybean: Soybean oil demand boosted, supply and policy game
Fundamental analysis: CBOT soybean futures rose slightly on Tuesday, with August soybeans (SQ25) closing at $10.2975 per bushel, essentially unchanged. The 1.8% rise in soybean oil prices became the main support, stemming from the 45Z tax credit bill passed by the U.S. Senate, which incentivizes renewable diesel and biofuel projects and restricts imported raw materials, significantly benefiting domestic soybean oil and soybean growers in the United States. USDA May crushing data showed that soybean crushing reached 203.7 million bushels, slightly lower than expected but a record high for the same period, with annual cumulative crushing of 1.844 billion bushels, far exceeding the same period last year. However, good crop growth and favorable weather (100% of the main producing states had higher precipitation than normal) limited the upside of prices. In the international market, the EU's soybean meal imports in 2024/25 increased to 19.25 million tons, but U.S. soybeans faced low-price competition from South America. India's soybean planting area is expected to decrease by 5%, which may provide some support for global supply.
Position changes and sentiment: On July 1, commodity funds increased their net short positions in soybeans by 2,000 lots, but turned to net long positions of 7,000 lots in the past five trading days, and accumulated net long positions of 6,500 lots in 30 trading days, indicating that market sentiment has shifted from cautious to moderately bullish. Speculative funds' optimistic expectations for the demand outlook for soybean oil have driven long positions, but ample supply and export competition have limited the sustainability of bullish sentiment. In terms of basis, the spot basis in Illinois and Ohio has improved slightly, such as the Decatur soybean basis of +20 cents/bushel, reflecting the spot market's expectations for favorable policies.
Trend forecast: In the short term, soybean futures are supported by soybean oil demand and favorable policies, but bumper harvest expectations and weak exports pose resistance. August soybean futures may fluctuate in a narrow range of $10.20-10.50 per bushel, and attention should be paid to the progress of the bill and South American export trends.
Wheat: Buy on dips to support, supply pressure remains
Fundamental analysis: CBOT wheat futures rose to a one-week high on Wednesday, with September Chicago soft red winter wheat (ZW1!) rising 0.1% to $5.495 per bushel, after hitting its highest point since June 25. Bargain buying and short covering were the main drivers, with the market attracting bargain-buying after hitting a multi-year low in May. However, pressure from a bumper harvest in the northern hemisphere limited the upside, with new-season wheat from the United States and Russia entering the market. The USDA expects U.S. wheat stocks to be 836 million bushels on June 1, lower than the same period last year, reflecting a certain degree of supply tightening. The situation in Russia and Ukraine caused Ukraine's agricultural exports to fall 23.8% in June, which had a certain impact on global wheat supply. In terms of basis, the Chicago wheat basis was -10 cents per bushel, a slight improvement from the previous value, indicating cautious optimism in the spot market.
Position changes and sentiment: On July 1, commodity funds increased their net long position in wheat by 3,500 lots, with a net long position of 7,500 lots in the past five trading days and a cumulative net long position of 1,000 lots in 30 trading days, indicating that speculative funds have turned mildly bullish on the outlook for wheat. This sentiment shift is related to the recent bottoming of prices and short covering, but ample global supply has suppressed bullish enthusiasm. Traders' attention to the situation in Russia and Ukraine has also injected uncertainty into the market.
Trend forecast: Wheat futures are supported by bargain hunting in the short term, but the pressure of a good harvest and a strong dollar may limit the rise. September wheat futures may consolidate in the range of US$5.40-5.60 per bushel, and attention should be paid to global export data and weather changes.
Soybean oil: driven by favorable policies, the demand outlook is optimistic
Fundamental analysis: CBOT soybean oil futures rose 1.8% on Tuesday, boosted by the 45Z tax credit bill, which, if passed, will significantly stimulate domestic soybean oil demand in the United States. USDA data showed that U.S. soybean oil stocks fell to 1.875 billion pounds at the end of May, down from 1.976 billion pounds in April and 2.188 billion pounds in the same period last year, reflecting growing demand and tightening supply. Stronger global vegetable oil prices, such as Malaysian palm oil futures hitting a more than two-year high, also provided support for soybean oil. Basis data has not been updated yet, but the spot market has responded positively to the policy benefits, and the basis is expected to strengthen further.
Position changes and sentiment: On July 1, commodity funds increased their net long positions in soybean oil by 5,000 lots, with a net long position of 4,000 lots in the past five trading days and a cumulative net long position of 25,500 lots in 30 trading days, indicating that speculative funds are highly bullish on the prospects of soybean oil. This sentiment is driven by favorable policies and declining inventories, and traders expect that demand for biofuels will continue to push up prices.
Trend forecast: Supported by policies and demand, soybean oil futures still have room to rise in the short term and may test recent highs. It is necessary to pay attention to the final passage of the bill and the dynamics of the global vegetable oil market.
Soybean meal: Supply pressure dominates, weak in the short term
Fundamental analysis: CBOT soybean meal futures fell 0.6% on Tuesday due to weak exports and loose supply pressure. USDA data showed that US soybean meal stocks increased to 407,000 short tons at the end of May, up from 390,000 short tons in April, reflecting supply growth. Although soybean oil demand has pushed up crushing profits, oil mills have increased crushing volume, leading to further easing of soybean meal supply. The EU's soybean meal imports in 2024/25 increased to 19.25 million tons, but US soybean meal faces low-price competition from South America and lacks price competitiveness. The stability of domestic pig stocks provides some support for demand, but short-term supply pressures dominate.
Position changes and sentiment: On July 1, commodity funds increased their net short positions in soybean meal by 1,000 lots, but turned to a net long position of 4,500 lots in the past five trading days, with a cumulative net short position of 20,500 lots in 30 trading days, indicating that market sentiment has improved in the short term but is generally bearish. Traders' concerns about oversupply dominate the market, but favorable policies may provide bottom support for prices.
Trend forecast: In the short term, soybean meal futures are limited by supply pressure and may fluctuate weakly at the current level. In the medium and long term, attention should be paid to policy progress and changes in export demand.
Future Trend Outlook
The short-term trend of the CBOT grain market is divergent. Corn is suppressed by the expectation of a bumper harvest, and the futures may be consolidated in the range of 4.00-4.20 US dollars per bushel; soybeans are supported by the demand for soybean oil and favorable policies, and the August futures may fluctuate between 10.20-10.50 US dollars per bushel; wheat rebounded due to bargain hunting, but the pressure of a bumper harvest limited the increase, and the September futures may be consolidated at 5.40-5.60 US dollars per bushel; soybean oil is driven by policies and demand, and there is still upward potential in the short term; soybean meal is weak and volatile due to loose supply. Traders need to pay close attention to the USDA inventory report, weather changes and international export trends to grasp the market direction.
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- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
