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Hedge funds and commodity investors are piling into U.S. grain markets, with open interest, volume and prices surging in corn and soybeans. Trend-following funds have been drawn by rising crude oil prices and a weaker U.S. dollar, despite large existing grain inventories.
Traders said the funds are buying cheap supplies in hopes of selling at higher prices later.
Fund inflows can drive prices up and add volatility even without a change in supply or demand fundamentals, so feed prices may move ahead of physical supply. Buyers should expect price swings if fund positions unwind.
agweek.comTom Polansek, Julie Ingwersen/ReutersApr 15, 2016Not enough comparable past events yet for a historical read.
Not enough comparable past events yet for a historical read.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
