Soft Commodities: Cotton Speculators boost their bullish bets

May 27, 2023

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) reports data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday May 23rd and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Changes led by Cotton & Sugar

The COT soft commodities markets speculator bets were lower this week as five out of the eleven softs markets we cover had higher positioning while the other six markets had lower speculator contracts.


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Leading the gains for the softs markets was Cotton (20,764 contracts) with Sugar (2,981 contracts), Coffee (1,713 contracts), Soybean Oil (1,620 contracts) and Cocoa (1,319 contracts) also showing positive weeks.

The markets with the declines in speculator bets this week were Corn (-13,808 contracts) with Soybeans (-8,949 contracts), Soybean Meal (-2,319 contracts), Wheat (-4,907 contracts), Live Cattle (-469 contracts) and Lean Hogs (-5,118 contracts) also registering lower bets on the week.

Highlights of Weekly positions:

Cotton speculative bets this week (+20,764 contracts) jumped by the highest weekly amount in over a year. This has brought the current speculator standing to the most bullish level (+22,319 contracts) since October of 2021. Cotton prices have had a big downfall since their highs in May of 2022 with a peak-to-trough drop of over 50 percent but looked to have bottomed for the time being.

Soybeans bets have dropped sharply over the past two months with speculator positions falling for seven straight weeks. The current net position for Soybeans is at the lowest level since November of 2021 due to an expectation of a record crop in the United States.

Wheat speculator bets dipped again this week and have declined in ten out of the past fourteen weeks. Wheat prices have cooled off markedly since screaming higher at the onset of the Russian invasion of Ukraine. The futures price has fallen over 50 percent from the highest levels of 2022 and has recently crossed below the 200-week moving average.

Corn speculator positions declined this week and have now fallen by a total of -167,903 contracts over the past 5-week period. This recent bearishness has brought the speculator positioning into an overall bearish level for the first time since August of 2020. Like many of the other agriculture soft commodities, Corn prices are down from their 2022 highs with the current Corn level lower by about 25 percent from May 2022.


Data Snapshot of Commodity Market Traders | Columns Legend
May-23-2023 OI OI-Index Spec-Net Spec-Index Com-Net COM-Index Smalls-Net Smalls-Index
WTI Crude 1,847,901 40 193,119 9 -217,386 91 24,267 28
Gold 479,080 26 160,732 48 -187,023 52 26,291 46
Silver 135,740 21 21,958 50 -34,972 52 13,014 39
Copper 215,394 55 -29,808 2 27,496 97 2,312 33
Palladium 11,138 71 -5,289 17 5,669 85 -380 19
Platinum 73,079 82 27,479 79 -32,157 27 4,678 31
Natural Gas 1,338,868 76 -112,278 27 80,837 72 31,441 55
Brent 146,776 19 -47,806 10 45,210 92 2,596 44
Heating Oil 306,360 39 9,097 43 -16,705 80 7,608 25
Soybeans 651,248 17 29,205 1 -2,404 96 -26,801 28
Corn 1,299,841 14 -62,267 22 115,832 88 -53,565 23
Coffee 198,683 11 32,748 61 -33,373 43 625 20
Sugar 983,887 67 273,810 88 -323,323 11 49,513 67
Wheat 379,453 54 -86,319 3 80,586 98 5,733 93

 


Strength Scores led by Cocoa & Live Cattle

COT Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is Extreme-Bullish and below 20 is Extreme-Bearish) showed that Cocoa (100 percent) and Live Cattle (92 percent) lead the softs markets this week. Sugar (88 percent), Soybean Meal (65 percent) and Coffee (61 percent) come in as the next highest in the weekly strength scores.

On the downside, Lean Hogs (0 percent), Soybean Oil (1 percent), Soybeans (1 percent) and the Wheat (3 percent) come in at the lowest strength levels currently and are in Extreme-Bearish territory (below 20 percent).

Strength Statistics:
Corn (22.1 percent) vs Corn previous week (23.8 percent)
Sugar (87.7 percent) vs Sugar previous week (86.7 percent)
Coffee (61.0 percent) vs Coffee previous week (59.3 percent)
Soybeans (0.6 percent) vs Soybeans previous week (4.2 percent)
Soybean Oil (0.9 percent) vs Soybean Oil previous week (0.0 percent)
Soybean Meal (65.1 percent) vs Soybean Meal previous week (66.3 percent)
Live Cattle (92.1 percent) vs Live Cattle previous week (92.6 percent)
Lean Hogs (0.0 percent) vs Lean Hogs previous week (4.3 percent)
Cotton (25.5 percent) vs Cotton previous week (9.9 percent)
Cocoa (100.0 percent) vs Cocoa previous week (98.4 percent)
Wheat (2.8 percent) vs Wheat previous week (6.4 percent)

 

Cotton & Coffee top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that Cotton (19 percent) and Coffee (8 percent) lead the past six weeks trends for soft commodities. Live Cattle (8 percent), Cocoa (7 percent) and Sugar (5 percent) are the next highest positive movers in the latest trends data.

Soybeans (-59 percent) leads the downside trend scores currently with Corn (-21 percent), Wheat (-14 percent) and Soybean Oil (-13 percent) following next with lower trend scores.

Strength Trend Statistics:
Corn (-21.2 percent) vs Corn previous week (-17.1 percent)
Sugar (5.0 percent) vs Sugar previous week (8.6 percent)
Coffee (8.1 percent) vs Coffee previous week (18.9 percent)
Soybeans (-59.0 percent) vs Soybeans previous week (-57.4 percent)
Soybean Oil (-12.6 percent) vs Soybean Oil previous week (-11.8 percent)
Soybean Meal (-3.1 percent) vs Soybean Meal previous week (-0.4 percent)
Live Cattle (7.9 percent) vs Live Cattle previous week (17.9 percent)
Lean Hogs (-8.2 percent) vs Lean Hogs previous week (-7.5 percent)
Cotton (19.3 percent) vs Cotton previous week (6.2 percent)
Cocoa (6.6 percent) vs Cocoa previous week (4.6 percent)
Wheat (-14.3 percent) vs Wheat previous week (-15.0 percent)


Individual Soft Commodities Markets:

CORN Futures:

The CORN large speculator standing this week equaled a net position of -62,267 contracts in the data reported through Tuesday. This was a weekly lowering of -13,808 contracts from the previous week which had a total of -48,459 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 22.1 percent. The commercials are Bullish-Extreme with a score of 88.4 percent and the small traders (not shown in chart) are Bearish with a score of 22.6 percent.

CORN Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 21.8 52.5 9.0
– Percent of Open Interest Shorts: 26.6 43.6 13.1
– Net Position: -62,267 115,832 -53,565
– Gross Longs: 282,880 682,886 116,884
– Gross Shorts: 345,147 567,054 170,449
– Long to Short Ratio: 0.8 to 1 1.2 to 1 0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 22.1 88.4 22.6
– Strength Index Reading (3 Year Range): Bearish Bullish-Extreme Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -21.2 22.9 3.7

 


SUGAR Futures:

The SUGAR large speculator standing this week equaled a net position of 273,810 contracts in the data reported through Tuesday. This was a weekly increase of 2,981 contracts from the previous week which had a total of 270,829 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 87.7 percent. The commercials are Bearish-Extreme with a score of 11.0 percent and the small traders (not shown in chart) are Bullish with a score of 67.1 percent.

SUGAR Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 35.6 39.2 9.4
– Percent of Open Interest Shorts: 7.8 72.1 4.3
– Net Position: 273,810 -323,323 49,513
– Gross Longs: 350,244 386,150 92,284
– Gross Shorts: 76,434 709,473 42,771
– Long to Short Ratio: 4.6 to 1 0.5 to 1 2.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 87.7 11.0 67.1
– Strength Index Reading (3 Year Range): Bullish-Extreme Bearish-Extreme Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 5.0 -1.8 -10.5

 


COFFEE Futures:

The COFFEE large speculator standing this week equaled a net position of 32,748 contracts in the data reported through Tuesday. This was a weekly gain of 1,713 contracts from the previous week which had a total of 31,035 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 61.0 percent. The commercials are Bearish with a score of 42.7 percent and the small traders (not shown in chart) are Bearish with a score of 20.2 percent.

COFFEE Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 27.0 44.6 3.7
– Percent of Open Interest Shorts: 10.5 61.4 3.3
– Net Position: 32,748 -33,373 625
– Gross Longs: 53,687 88,628 7,267
– Gross Shorts: 20,939 122,001 6,642
– Long to Short Ratio: 2.6 to 1 0.7 to 1 1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 61.0 42.7 20.2
– Strength Index Reading (3 Year Range): Bullish Bearish Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 8.1 -8.1 3.2

 


SOYBEANS Futures:

The SOYBEANS large speculator standing this week equaled a net position of 29,205 contracts in the data reported through Tuesday. This was a weekly lowering of -8,949 contracts from the previous week which had a total of 38,154 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 0.6 percent. The commercials are Bullish-Extreme with a score of 96.0 percent and the small traders (not shown in chart) are Bearish with a score of 28.4 percent.

SOYBEANS Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 21.3 53.9 6.8
– Percent of Open Interest Shorts: 16.8 54.3 11.0
– Net Position: 29,205 -2,404 -26,801
– Gross Longs: 138,687 351,024 44,581
– Gross Shorts: 109,482 353,428 71,382
– Long to Short Ratio: 1.3 to 1 1.0 to 1 0.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 0.6 96.0 28.4
– Strength Index Reading (3 Year Range): Bearish-Extreme Bullish-Extreme Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -59.0 50.6 7.0

 


SOYBEAN OIL Futures:

The SOYBEAN OIL large speculator standing this week equaled a net position of -27,863 contracts in the data reported through Tuesday. This was a weekly lift of 1,620 contracts from the previous week which had a total of -29,483 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 0.9 percent. The commercials are Bullish-Extreme with a score of 99.3 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 5.6 percent.

SOYBEAN OIL Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 16.0 55.8 5.6
– Percent of Open Interest Shorts: 21.2 50.5 5.8
– Net Position: -27,863 28,911 -1,048
– Gross Longs: 86,842 302,248 30,161
– Gross Shorts: 114,705 273,337 31,209
– Long to Short Ratio: 0.8 to 1 1.1 to 1 1.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 0.9 99.3 5.6
– Strength Index Reading (3 Year Range): Bearish-Extreme Bullish-Extreme Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -12.6 10.9 3.0

 


SOYBEAN MEAL Futures:

The SOYBEAN MEAL large speculator standing this week equaled a net position of 110,022 contracts in the data reported through Tuesday. This was a weekly decline of -2,319 contracts from the previous week which had a total of 112,341 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 65.1 percent. The commercials are Bearish with a score of 40.0 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 0.0 percent.

SOYBEAN MEAL Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 28.5 38.4 9.1
– Percent of Open Interest Shorts: 5.5 63.4 7.0
– Net Position: 110,022 -119,902 9,880
– Gross Longs: 136,546 184,271 43,425
– Gross Shorts: 26,524 304,173 33,545
– Long to Short Ratio: 5.1 to 1 0.6 to 1 1.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 65.1 40.0 0.0
– Strength Index Reading (3 Year Range): Bullish Bearish Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -3.1 7.4 -36.9

 


LIVE CATTLE Futures:

The LIVE CATTLE large speculator standing this week equaled a net position of 101,647 contracts in the data reported through Tuesday. This was a weekly fall of -469 contracts from the previous week which had a total of 102,116 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 92.1 percent. The commercials are Bearish-Extreme with a score of 12.2 percent and the small traders (not shown in chart) are Bearish with a score of 24.0 percent.

LIVE CATTLE Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 45.6 27.0 9.7
– Percent of Open Interest Shorts: 15.0 54.1 13.3
– Net Position: 101,647 -89,891 -11,756
– Gross Longs: 151,178 89,344 32,235
– Gross Shorts: 49,531 179,235 43,991
– Long to Short Ratio: 3.1 to 1 0.5 to 1 0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 92.1 12.2 24.0
– Strength Index Reading (3 Year Range): Bullish-Extreme Bearish-Extreme Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 7.9 -2.6 -27.2

 


LEAN HOGS Futures:

The LEAN HOGS large speculator standing this week equaled a net position of -33,852 contracts in the data reported through Tuesday. This was a weekly fall of -5,118 contracts from the previous week which had a total of -28,734 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 0.0 percent. The commercials are Bullish-Extreme with a score of 100.0 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 98.8 percent.

LEAN HOGS Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 25.8 37.8 10.6
– Percent of Open Interest Shorts: 40.3 24.7 9.1
– Net Position: -33,852 30,405 3,447
– Gross Longs: 60,033 88,003 24,705
– Gross Shorts: 93,885 57,598 21,258
– Long to Short Ratio: 0.6 to 1 1.5 to 1 1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 0.0 100.0 98.8
– Strength Index Reading (3 Year Range): Bearish-Extreme Bullish-Extreme Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -8.2 8.0 4.4

 


COTTON Futures:

The COTTON large speculator standing this week equaled a net position of 22,319 contracts in the data reported through Tuesday. This was a weekly rise of 20,764 contracts from the previous week which had a total of 1,555 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 25.5 percent. The commercials are Bullish with a score of 72.7 percent and the small traders (not shown in chart) are Bearish with a score of 38.5 percent.

COTTON Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 32.9 46.0 6.7
– Percent of Open Interest Shorts: 21.4 59.5 4.8
– Net Position: 22,319 -26,017 3,698
– Gross Longs: 63,540 88,722 13,024
– Gross Shorts: 41,221 114,739 9,326
– Long to Short Ratio: 1.5 to 1 0.8 to 1 1.4 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 25.5 72.7 38.5
– Strength Index Reading (3 Year Range): Bearish Bullish Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 19.3 -19.7 21.1

 


COCOA Futures:

The COCOA large speculator standing this week equaled a net position of 65,374 contracts in the data reported through Tuesday. This was a weekly increase of 1,319 contracts from the previous week which had a total of 64,055 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 100.0 percent. The commercials are Bearish-Extreme with a score of 0.0 percent and the small traders (not shown in chart) are Bullish with a score of 50.3 percent.

COCOA Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 42.4 29.0 4.7
– Percent of Open Interest Shorts: 23.0 50.1 3.1
– Net Position: 65,374 -70,745 5,371
– Gross Longs: 142,438 97,452 15,901
– Gross Shorts: 77,064 168,197 10,530
– Long to Short Ratio: 1.8 to 1 0.6 to 1 1.5 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 100.0 0.0 50.3
– Strength Index Reading (3 Year Range): Bullish-Extreme Bearish-Extreme Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 6.6 -6.8 2.1

 


WHEAT Futures:

The WHEAT large speculator standing this week equaled a net position of -86,319 contracts in the data reported through Tuesday. This was a weekly reduction of -4,907 contracts from the previous week which had a total of -81,412 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 2.8 percent. The commercials are Bullish-Extreme with a score of 97.7 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 92.8 percent.

WHEAT Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 29.6 37.2 9.8
– Percent of Open Interest Shorts: 52.4 16.0 8.3
– Net Position: -86,319 80,586 5,733
– Gross Longs: 112,390 141,282 37,340
– Gross Shorts: 198,709 60,696 31,607
– Long to Short Ratio: 0.6 to 1 2.3 to 1 1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct): 2.8 97.7 92.8
– Strength Index Reading (3 Year Range): Bearish-Extreme Bullish-Extreme Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -14.3 15.3 4.7

 


Article By InvestMacroReceive our weekly COT Newsletter

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting). See CFTC criteria here.

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