There was some opening volatility with Jul’23 swinging between 24.06/24.32 over the first few minutes, before things settled down to sit calmly either side of unchanged levels. Friday’s COT report showed that the funds are still disinterested in proceedings (aside from totting up their balance sheet from their well-established longs) their position growing only marginally once again to stand at 214,523 lots long at cob 18th April. With this in mind it remains clear that the trade squeeze remains the driving factor behind current movements, and while the picture was generally quiet through the later morning there were signs that they were again pushing with the price edging back into the 24.50’s. The US morning has had less significance recently with no spec flourish to get things moving, and so it was not until mid-afternoon that further movement arrived, and it will not have shocked many to find that it was the upside being pursued again, wiping out the rest of Fridays losses with a push back towards 25.00. Selling remains limited and so an aggressive push easily took prices into fresh ground for the fourth successive session, this time reaching 25.42 before pausing (which the soon to expire May’23 contract reached a mighty 25.99). Consumers were again chasing as they complete the last of any May’23 pricing while also covering in against Jul’23 for fear that the relentless push will continue, and so there was only limited retreat from the highs during the remainder of the session. A little MOC buying ensured another very strong technical settlement at 25.32 for Jul’23, impressive in the way it responded to Friday’s pullback and suggesting further forays into the overhead vacuum to come as the squeeze goes on.
Friday’s showing was rather disappointing in the context of this month’s movements, however a wild opening range which saw Aug’23 trade up from $675.10 to $683.20 before calming showed that there remains a desire to keep pushing and challenge the $700 mark. Most of the morning was spent consolidating the lower $680’s which enabled the white premium values to recover some of the recent losses, Aug/Jul’23 working back to the mid $140’s albeit against no real volume. The picture began to show some relative change as we moved into the afternoon, with prices staring to fall back despite the No.11 market maintaining its own push upward, leading these premium gains to be wiped out. With No.11 driving ahead to new contract highs there was a drag effect that pulled the whites values upward too with Aug’23 back into the $490’s, however while the Aug/Oct’23 spread was seeing a decent volume there was no great strengthening for the spread value and so prices were never able to challenge last Thursday’s contract high at $697.30. Once the buying dried up a rapid retreat to $685.00 re-emphasised the lack of buying at these levels despite the chase which has been seen from trade and consumer buyers, and with the Aug/Jul’23 premium all the way back at $132.00 there was a feeling of fatigue. Settlement was made at $690.10 following some late buying, though the performance suggests that higher levels may be reliant on the No.11 movement continuing for the time being.
