Managed Money Cuts Net Long by Over 1 Billion Bushels
Over the last two weeks, tariff chatter has ramped up, making market participants uneasy about the future. Managed Money, which had been unwinding its 1.75-billion-bushel net short since late July 2024, reached a net long position of 1.75 billion bushels by the first week of February 2025.
One of the biggest challenges in pushing corn prices higher over the last 30-45 days was the sheer size of Managed Money’s early long position. Their short position bottomed out at 385 million bushels, with historical lows typically around 100 million. That remaining 100 million bushels seemed like potential fuel for another leg up—if there was one at that time.
But that didn’t happen. Tariffs were introduced, and Managed Money was liquidated. As a result:
Front-end corn prices dropped by 75 cents
Soybeans continued their downtrend toward $10
However, despite these movements, we haven’t seen a significant impact on corn or bean exports—yet. The U.S. is already largely out of the soybean export business at this point. And as a side note, COFCO and Sinograin—China’s government grain trading arms—aren’t hamstrung by tariffs.
Export Sales & USDA Projections
If we break down the numbers based on USDA’s current 2024 crop year projection, dividing the remaining sales evenly across the weeks left in the marketing year, last week's sales were significantly above the required pace:
✓ Soybean sales were nearly 5X what needed to be sold
✓ Corn sales were nearly 2.5X
✓ The five-week average for both remains over 2X the required weekly pace
While there’s still plenty of time left, the USDA has underestimated total demand for over a year, and it seems they might be doing so again. Last summer, the sentiment was delayed in recognizing stronger-than-expected exports, with media narratives only catching up in November/December.
What’s Next?
With carryout potentially facing further reductions in upcoming reports and corn’s main risk season ahead, Managed Money has pulled back its net long position to more manageable levels. This could signal less bullishness or simply caution in a highly volatile environment.
Regardless, global corn and wheat supplies remain tight, as both USDA data and cash markets suggest. Any further tightening in supply could quickly attract renewed buying interest from speculators.
Sources
USDA Foreign Ag Service
Garret Brown
Founder | Market Advisor
Having grown up on a farm, Garret respects the wide range of skills needed to run a successful operation and recognizes farmers are often stretched thin trying to do it all. This understanding, along with his affinity for markets, fuels his drive to make tough marketing decisions simpler for farmers.
Leveraging his experience in grain origination and margin management, Garret analyzes technical and fundamental market information. With the assistance of CODAK’s algorithmic signaling platform, he puts together buy/sell recommendations while working with the CODAK team to create strategies that accommodate each farmer’s personal risk tolerance, on-farm storage capacity, and break-evens.