By Kirk Maltais


-Corn for May delivery rose 1.3% to $4.30 1/4 a bushel, on the Chicago Board of Trade on Monday, after Friday's CFTC Commitment of Traders report confirmed that fund traders have begun to cover their enormous short position in corn.

-Wheat for May delivery rose 1.1% to $5.63 3/4 a bushel.

-Soybeans for May delivery rose 0.3% to $11.54 1/2 a bushel.


HIGHLIGHTS


Cutting Back: CBOT grains were up throughout the day, after the CFTC's Commitment of Traders report on Friday showed drops in short contracts by managed money traders for corn and wheat -- with corn shorts reduced by over 35,000 contracts. The data covers trading through Feb. 27. "The market has priced in a lot of bearishness, we are through first notice day, U.S. acres are expected to shrink considerably, and it's dry in Brazil as their second crop growing season gets underway," said Doug Bergman of RCM Alternatives in a note.

Outside Pressure: Short-covering lifted grains, but weaker crude oil futures kept that rally in check. "News OPEC would maintain production cuts was expected to provide support via renewable fuels," Karl Setzer of Consus Ag Consulting said. However, the OPEC announcement was apparently already priced into those futures, and the lack of further surprises put weight on the commodities complex.


INSIGHT


WASDE Watch: This week's WASDE report from the USDA is the next major landmark for U.S. grain traders, coming before the USDA's annual Prospective Planting report at the end of the month. With U.S. planting beginning next month, attention will be largely on South American figures, says Daniel Flynn of Price Futures Group in a note. "The USDA has a history of waiting until March to make sizable adjustments based on actual harvested yield data," Flynn says, regarding South American data. The report is due out at noon eastern time Friday.

Switching Sentiment: Market watchers today questioned how long a real short-covering rally could last. "A sustained bull market is not currently sustainable, but short covering could lift us higher for the month of March," Brian Hoops of Midwest Market Solutions says. "I do think we are changing the narrative from selling every rally in the grains to placing a small premium into values." Friday's WASDE report is expected to contain mixed results for futures movement, Hoops said, but the soon-to-start U.S. growing season is making traders re-evaluate their large short positions on grains.

Reluctant to Sell: U.S. farmers have been holding off from selling the bulk of their crops, in hopes of prices improving to better compensate for the high input costs seen in the past marketing year. Fund traders are getting more nervous about their large holdings of short positions as the USDA's Prospective Planting report at the end of the month nears -- possibly giving farmers an opportunity to sell the bulk of their crop, said Arlan Suderman of StoneX in a note. However, Suderman adds, increased farmer selling may keep a lid on prices.


AHEAD


-Ag Growth International will release its fourth-quarter 2023 earnings report after the stock market closes Tuesday.

-The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.

-The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.


(END) Dow Jones Newswires

03-04-24 1603ET