Funds Flee Bullish Crop Bets as Hurricane Ida Disrupts Exports
(Bloomberg) -- Hurricane Ida knocked out at least 10% of U.S. grain export capacity, and in the process wiped away optimism that corn and soy prices would rise.
Ida damaged grain elevators and shut off power at New Orleans-area terminals when it barreled through Louisiana at the beginning of the week. The shutdown in an area responsible for almost 60% of U.S. exports came as rains in the Midwest were raising expectations for the nation’s harvest.
Money managers reduced combined net-long positions in corn, soybeans, soybean meal and soyoil futures and options by 10.6% in the week ended Aug. 31, the most since June. Bets on higher prices for Chicago soybeans and soymeal sank to a one-year low, U.S. Commodity Futures Trading Commission data showed Friday. Corn futures fell at one point this week to the lowest level since early July.
Meanwhile, analysts surveyed by Bloomberg expect the Department of Agriculture to lift U.S. crop reserve estimates in a report next week.
Potential export disruptions and better supply prospects have this year’s rally in crops to near-decade highs -- which was already teetering -- on even shakier ground.
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