Speculators Not On Board Commodity Futures Rally

Even as valid concerns linger regarding parched fields reducing commodity crop supplies, commodity speculators still reduced their long positions for agricultural crops to rally from recent lows.  The recent commodity gains were from grain and livestock markets.

Earlier this month, Commodity Futures Trading Commission data revealed major commodity futures fund managers cutting away from eleven different farm related markets by as much as 20%.  Agricultural commodities, however, accounted for nine of the 10 best commodity futures performers in a major index of commodity markets last week.

The seemingly endless European crisis coupled with a slowing global economy has had an impact on commodity prices and market psychology.  Until leaders globally step up and do what they were elected to do, lead, and make structural changes the markets will continue to become immune to bailouts,” said Kevin Craney, senior commodities broker for RJO Futures in Chicago, regarding the current commodity futures situation.  Craney added, “Breaking the cycle of short-term fixes and moving forward with structural fixes and growth policies will help commodity market psychology and prices long-term.”

The commodity futures markets we trade – mostly grain markets – started off with a bang earlier in the year, but have since simmered.  The seasonal trends are mixed, but I expect these markets to trend better starting next month (just my sole opinion)


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