In the week ended Tuesday, managed money, or large fund speculators, increased their net long position in live cattle futures by a small margin as futures prices attempted, but failed, to stabilize.
During the week, managed money’s net long position increased 1,097 contracts, or 21.9%, to 6,098 from 5,001 the week before, according to the Commodity Futures Trading Commission’s weekly Commitments of Traders report, which was released Friday.
At the same time, commercial traders, those who potentially could make or take delivery of a futures contract, increased their net short positions by only 870 contracts, or 2.91%, to 30,803 from 29,933. The CFTC said.
To arrive at their new net long position, the funds liquidated a net 1,049 contracts while covering 2,146 short positions and cutting total spread positions by 3,203. This left them representing 21.8% of total long open interest and 19.4% of total short open interest.
Commercials, meanwhile, arrived at their new net position by adding 2,967 net long positions and 3,837 new short positions, leaving them holding 22.4% of total long open interest and 34.2% of total short open interest.
Total open interest during the latest reporting week decreased 5,748 contracts, or 2.15%, to 261,329 from 267,077.
During the latest CFTC reporting week, the most-active Dec contract fell $7.05, or 5.18%, closing Tuesday, Sep. 29, at $129.17 per cwt, compared with $136.22 the previous Tuesday. Along the way, it left a small gap on daily charts from $135.37 per cwt on Sep. 22 to 135.17 on Wednesday, Sep. 23.
And during the latter days of the latest reporting week, the market tried to rally, but it was only able to muster a small consolidation before resuming its sharp declines.
FUNDS, COMMERCIALS GET SHORTER IN CORN FUTURES
During the latest reporting week large investment funds and commercial traders either reduced their net long corn positions or increased their net short positions.
Managed money reduced their net long corn positions by 7,842 contracts, or 11.0%, to 63,451 from 71,293.
At the same time, commercial traders extended their net short positions to 317,354 contracts from 302,256, an increase of 15,098, or 5.10%.
To arrive at their new net long position, the funds sold a net 3,507 long positions and added 4,335 short and 3,309 spread positions. This left them holding 18.5% of total long open interest and 13.6% of total short open interest.
Commercial traders arrived at their new net short position by adding 8,710 long positions and 23,808 new short positions, leaving them representing 22.3% of total long open interest and 46.8% of total short open interest.
The most active Dec futures contract rose during the week on its way to a test of resistance at the Sep. 15 high of $3.95 a bushel. The contract closed Tuesday at $3.89, up $0.08 ½, or 2.23%, from a close the previous Tuesday of $3.80 ½.
CASH FED CATTLE TRADE LOW AND SLOW
Cash prices plunged last week, with prices reported at $116 to $124 per cwt on a live basis, down $10 to $12 from the previous week. On a dressed basis, cattle traded at $187 to $190, down $12 to $14.
The USDA reported lower boxed beef prices again Friday with its choice cutout down $1.78 per cwt at $205.77 and select off $1.85 at $201.36 with 129 loads of fabricated product sold into the spot market.
Friday’s choice/select spread widened to $4.41, compared with $2.43 a week earlier. However, it remains well below the 2009-2013 average of about $12.00.
The CME Feeder Cattle Index for the seven days ended Thursday was $187.89 per cwt, down $1.04. This compares with the Oct settlement Friday of $179.50, up $2.10.