Funds Cut Long Cattle Positions

Large investment funds, called managed money, cut their net long live cattle futures position for the second straight time during the week ended Tuesday as commercial traders only trimmed their large net short position.

The Commodity Futures Trading Commission, said in its weekly Commitments of Traders Report Friday that managed money’s new net long position was 119,794 contracts, down 5,315, or 4.25%, from 125,109 the previous week.  It also was down 13,386, or 10.1%, from the latest high of 133,180 contracts the week ended April 25.

Commercial traders, those who theoretically could make or take delivery of a futures contract, had a net short position of 204,474 contracts during the week ended Tuesday, down 1,181, or 0.57%, from 205,655 the previous week.

Swap dealers who facilitate cash and over-the-counter trades, held a net long position of 102,193 contracts during the latest CFTC week, down 74, or 0.07%, from 102,267 the previous week.

The CFTC reported that managed money arrived at its new position by liquidating 5,102 long positions and adding 213 short positions along with 296 spread positions.  This left them representing 33.5% of total long open interest and 5.0% of total short open interest with 10.0% of spread open interest.

Commercials got to where they were by adding 1,856 long positions and 675 short positions, leaving them in control of 6.5% of total long open interest and 55.1% of total short open interest.

At the same time, swap dealers liquidated 565 long positions, covered 491 short positions and unwound 570 spread positions to leave them with 25.0% of total long open interest, 0.7% of total short open interest and 0.4% of total spread open interest.

The CME Group reported that total live cattle open interest declined 11,969 contracts, or 2.77%, during the week to 420,154 from 432,123.

CME Group data also show the most-active Jun contract rose to a contract high of $134.55 per cwt during the week.  However, Tuesday’s close of $124.97 was below the $127.05 previous Tuesday’s close.

 

FUNDS TAKE LARGE SHORT CORN POSITION

 

During the same CFTC week, managed money re-established its trend toward a large net short position with 203,976 contracts, up 33,373, or 19.6%, from 170,603 the previous week.

At the same time, commercial traders reduced their net short position to 108,518 contracts from 130,383 the previous week, a decline of 21,865, or 16.7%.

The CFTC said managed money arrived at its new short position by liquidating 4,309 long positions and adding 29,064 short and 6,674 spread positions.  This left them representing 14.0% of total long open interest, 29.0% of total short open interest and 6.4% of total spread open interest.

Commercials added 12,941 long positions to their total while they covered 8,924 short positions, leaving them in control of 25.5% of total long open interest and 33.5% of total short open interest.

 

CASH CATTLE QUIET

 

After trading on the livestock exchange Wednesday at an average of $138.40 per cwt on a live basis, down $1.75 from $140.15 a week earlier, fed cattle began to trade in the Plains.

Cash cattle traded at $138 to $138.50 per cwt live on Wednesday, but the volume came at $138, down $2 to $3.50.  Thursday, more traded down to $136.

Dressed-basis trade was down $9 to $10 at $220 per cwt.

The USDA’s choice cutout Friday was up $0.83 per cwt at $247.69, while select was off $1.15 at $225.51.  The choice/select spread widened to $22.18 from $20.20 with 53 loads of fabricated product sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Thursday was $143.48 per cwt, down $2.02.  This compares with Friday’s May settlement at $143.48, down $2.02.