Grains Slump as Funds Hold Long Positions Amidst Inflationary Buying

Grain futures closed lower on Friday due to pre-holiday profit taking and positioning ahead of the WASDE report. Chip Nellinger, an expert with Blue Reef Agri-Marketing, noted that while the selling was muted in corn and soybeans, wheat saw more pressure due to potential peace talks between Russia and Ukraine.

Nellinger expressed concern about the funds' large long position in corn and beans, which he believes may lead to a break if not addressed. He also suggested that commercials and end-users may be out of position, making them potential buyers on a market downturn.

Despite the lower close, corn and soybeans still posted higher weekly closes, with November soybeans above $13. Nellinger attributed this resilience to inflationary and Super El Niño buying, which could keep funds in their long position well into 2027.