Managed Money’s 180-Degree Swing in Corn Ownership
Since July 27th, Managed Money has been on a corn-buying spree, just after futures spreads bottomed out in mid-July. During that time, USDA's U.S. carryout expectations shifted dramatically, dropping from 2.097 billion bushels to 1.540 billion. Yet, for months—through at least November—the media narrative maintained a strong bearish outlook on corn.
The record-setting cuts to yield in January significantly tightened up the corn supply-and-demand balance sheet. Basis and futures spreads hinted at this possibility for months, but what surprised many was that the USDA printed it.
Looking ahead, the period from April through June will be critical. During this time, the U.S. will plant the world’s largest corn crop, while Brazil’s Safrinha crop enters its vegetative stage. As we’ve noted over the past six months, carryout expectations for major importers and exporters remain extremely tight. This tightness has made U.S. supplies a value buy—an opportunity that Mexico and numerous other international buyers capitalized on over the last six months.
However, I’m not writing this to rehash why corn prices could take another leg higher. Instead, I want to focus on something else: why you need to guard yourself against potential narrative spin this spring suggesting that corn can’t sell off hard.
Managed Money: A Look Back and the Risks Ahead
A year ago, farmers were significantly undersold, while Managed Money pushed their net short position to a staggering 280,000 contracts—roughly 1.4 billion bushels. For context, the 2024 crop was around 14.8 billion bushels. That short position grew even larger, peaking at around 320,000 contracts before Managed Money covered over 80% of it by mid-May. This massive short covering caused a 78 ¾-cent rally in the continuous front-month contract.
From May 14th to July 9th, however, Managed Money re-established its short position, adding more contracts to reach just over 350,000 contracts—or 1.75 billion bushels. When they eventually began liquidating those shorts, it coincided with farmer selling, driving corn prices to a seasonal low of 360 ¼ at the end of August.
What’s Different in 2025?
The dynamics heading into 2025 carry a level of risk that didn’t exist last year. In early 2024, before the growing season even began, Managed Money was nearing a record short position. By contrast, in 2025, farmers are now sitting on unsold portions of their 2024 crop while presumably holding nearly all of their 2025 crop.
Meanwhile, Managed Money has made a dramatic shift. Since July 9th, they’ve purchased an incredible 678,000 contracts—approximately 3.4 billion bushels of corn—according to the latest Commitment of Traders report from January 21st. This buying spree helped lift the continuous front-month contract to 490, a rise of 129 ¼ cents from the August low.
Key Takeaway
This dramatic shift in ownership and the buildup of unsold crops by farmers highlights the increased risks heading into 2025. As always, understanding the interplay between Managed Money, farmer selling, and market fundamentals will be crucial for navigating the year ahead.
Why It Matters
Speculators are already positioned bullishly, with a record-long position potentially within reach before planting even begins. The market was slow to recognize just how bullish this year could be. But the question now is whether the market will be just as slow to react if strong bearish inputs emerge.
After last year’s narrative was so blatantly off the mark, it’s entirely possible it could happen again this spring—particularly if no major issues arise between April and June. If Managed Money decides to swing its near-record-long position to a short as farmers wrap up planting, it could push corn prices substantially lower than many expect. Such a move could pressure farm balance sheets to levels that many may find hard to endure operationally.
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.