Funds, Commercials Sell Cattle

Managed money, or large fund investors, liquidated live cattle futures positions for the second straight week during the week ended Tuesday as commercial traders extended their net short positions.

The Commodity Futures Trading Commission’s weekly Commitments of Traders report Friday said funds’ net long live cattle futures position was 28,399 contracts, down 4,861, or 14.6%, from 33,260 the previous week, and the lowest since 18,959 the week ended May 10.

Commercial traders, those who theoretically could make or take delivery of a futures contract, extended their net short position by 774 contracts, or 1.04%, to 74,842 from 74,068 the previous week.  This is their largest net short position since the week ended May 17 when it was 77,418.

Managed money arrived at its new net long position by liquidating 3,874 longs and adding 987 shorts while unwinding 4,053 spreads.  This left them representing 23.4% of total long and 12.4% of total short open interest.

Commercials took their new net short position by liquidating 684 longs and adding 90 shorts.  This left them in control of 15.5% of total long open interest and 44.4% of total short open interest.

Total live cattle open interest during the week declined 8,523 contracts, or 3.18%, to 259,275 from 267,798, the CME Group said.

The CME also said the most-active Aug contract challenged the contract low during the week at $111.45 per cwt on Thursday, extending the decline that began Thursday, May 19.  During the week, the contract rose $4.88 per cwt, or 4.31%, to $118.05 from $113.17.

 

MANAGED MONEY GOES LONG CORN

 

During the latest reporting week, managed money extended its net long corn position to 142,290 contracts from 74,456, a gain of 67,834, or 91.1%, the CFTC said.  This is the largest net long position for these traders since the week ended Aug. 4 when it was 150,187 contracts.

Meanwhile, commercials extended their net short corn position to a near-record 448,612 contracts from 392,437 the previous week.  This is a gain of 56,175, or 14.3%, and is the largest net short position for these traders since the week ended July 21 when it was 451,212 contracts.

The CFTC said managed money arrived at its new corn position by adding 33,541 long positions and covering 34,293 shorts while adding 16,719 spreads.  This left them representing 18.1% of total long open interest and 8.0% of total short open interest.

Commercials extended their net short position by liquidating 43,524 longs and adding 12,651 shorts.  This left them in control of 22.6% of total long open interest and 54.4% of total short open interest.

Total corn open interest declined 15,304 contracts, or 1.07%, to 1.411 million from 1.427 million, the CME Group said.

During the latest reporting week, the most-active Jul corn contract continued its steep rise begun April 1, rising to a high of $4.13 ½ a bushel on Friday from a low on Tuesday of $3.94 ½.

 

CASH CATTLE MARKET $3 TO $7 HIGHER

 

Cash cattle markets Friday were traded $3 to $7 per cwt higher at $128 to $132.50 on a live basis.  Cattle traded at $203 per cwt, down $1, on a dressed basis early in the week, but moved to $2. To $3 higher at $206 to $207 later.

The USDA’s choice cutout Friday was $0.67 per cwt lower at $222.61 per cwt, while select was off $3.05 at $198.36.  The choice/select spread widened to $24.25 from $21.87 with 88 loads of fabricated product sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Thursday was $147.21 per cwt, up $1.94.  This compares with the Aug settlement Friday of $146.67, up $0.27.