Funds Boost Long Cattle Position

Large commodity investment funds, called managed money, boosted their net long live cattle futures position in the week ended Tuesday for the third straight week.  At the same time, commercial traders advanced their net short position for the second week.

The Commodity Futures Trading Commission said in its weekly Commitments of Traders report Friday that as of Tuesday, managed money had a net long live cattle position of 90,402 contracts, up 5,692, or 6.72%, from 84,712 the previous week.  This also was up from the most recent low point in their holdings of 74,667 contracts the week ended Sep. 5.

Commercial traders, those who actually own the cattle at some point in their lives and primarily are hedgers, had a net short position of 170,937 contracts as of Tuesday, up 6,912, or 4.21%, from 164,025 the previous week.

The CFTC said managed money arrived at its new long position by taking on 3,914 new long positions, covering 1,776 short positions and unwinding 1,273 spread positions.  This left them representing 30.2% of total long open interest, 3.5% of total short open interest and 8.3% of total spread open interest.

Commercial traders got to their new net short position by adding 392 long positions and 7,304 short positions, leaving them in control of 7.1% of total long open interest and 57.7% of total short open interest.

The CME Group said total live cattle open interest during the week rose to 338,086 contracts from 326,939, a gain of 11,147, or 3.30%.

The most-active Dec futures contract had a net gain during the CFTC reporting week but showed great volatility in the process.  It started a week earlier with a close of $113.40 per cwt, rose to a swing high of $117.72 on Friday, sank to its most recent low of $113.10 on Tuesday before closing at $113.47.

 

FUNDS COVER CORN SHORTS

 

In the same week, managed money covered some of its net short position to leave it short by 121,671 contracts, a decline of 9,231, or 7.05%, from 130,902.  It was their first decline in the net short position in six weeks.

In contrast, commercial traders advanced their net short position by 15,547 contracts, or 7.77%, to 215,542 contracts from 199,995 the previous week.

The CFTC said managed money arrived at its new net short corn position by adding 978 long positions, covering 8,253 shorts and unwinding 4,955 spreads.

Commercials got to their new position by liquidating 4,475 long positions and adding 11,072 short positions, leaving them holding 24.3% of total long open interest and 39.7% of total short open interest.

The CME group said total corn open interest in the CFTC week rose to 1.407 million contracts from 1.397 million, a gain of 10,031, or 0.72%.

The most-active Dec contract rose during the CFTC week to close at $3.52 ¼ a bushel, up $0.04, or 1.15%, from $3.48 ¼.

 

CATTLE, BEEF RECAP

 

No cattle sold Wednesday on the Livestock Exchange video auction.

Cash trade was reported late last week at $107 to $108 per cwt on a live basis, steady to $1 lower than the bulk of last week’s action.  Sales in dressed markets were reported at $172, steady to up $2.

The USDA’s choice cutout Friday was up $0.21 per cwt at $196.62, while select was off $0.61 at $188.50.  The choice/select spread widened to $8.12 from $7.30 with 86 loads of fabricated product sold into the spot market.

The CME Feeder Cattle index for the seven days ended Thursday was $153.06 per cwt, up $0.98.  This compares with Friday’s Oct settlement of $152.22, down $0.72.