|Funds Reduce Bets on Rising Food Costs to Lowest in 27 Months: Commodities |
By Elizabeth Campbell - Dec 12, 2011
Hedge funds cut bullish bets on agricultural prices to the lowest level in more than two years on signs of expanding global supplies.
A measure of speculative positions across 11 products from wheat to coffee to cattle fell 3.6 percent to 258,071 futures and options in the week ended Dec. 6, Commodity Futures Trading Commission data show. That’s the lowest since September 2009. Bullish wagers on corn fell 11 percent to a 17-month low, and bearish ones on cocoa increased for a fourth week.
World food prices tracked by the United Nations retreated for a fifth consecutive month in November, the longest decline in more than two years. The U.S. government said Dec. 9 that combined global inventories of corn, soybeans and wheat will be 3.2 percent larger than anticipated a month earlier. Cocoa capped its longest slump in 50 years last week on increasing supplies from Ivory Coast, the world’s biggest producer.
“We’ve got all the harvest data, and there’s not a lot of catalysts that are going to turn around the direction of agricultural prices,” said Peter Sorrentino, a senior fund manager at Huntington Asset Advisors in Cincinnati, which oversees $14.5 billion of assets.