Large commodity investment funds, known as managed money, reached their lowest collective net long live cattle futures position in nearly a year Tuesday as they continued to liquidate long positions.
The Commodity Futures Trading Commission Friday said in its weekly Commitments of Traders report that managed money’s new net long live cattle position totaled 45,373 contracts, its lowest since July 24, 2018, when it was 45,103. The new position is the sixth straight decline since peaking at 155,183 on April 23 and is down 18,946, or 29.5%, from 64,319 a week earlier.
At the same time, commercial traders, those who own the cattle and primarily use the futures for hedging, cut their collective net short position as of Tuesday to 153,140 contracts. This also was their sixth straight decline in the net position since topping out at 226,677 on April 23 and was their lowest net short position since Dec. 4 when it was 148,552 contracts. It also was down 16,248, or 9.59%, from 169,388 a week earlier.
The CFTC said managed money arrived at its new net long cattle position by liquidating 10,197 long positions, adding 8,749 short positions and putting on 3,549 spread positions. This left their position representing 20.5% of total long open interest, 8.3% of total short open interest and 18.0% of total spread open interest.
Commercial traders got to where they were by adding 1,987 long positions and covering 14,261 short positions. This had their position representing 9.6% of total long open interest and 50.6% of total short open interest.
CME Group data showed total live cattle futures open interest on Tuesday was 373,348 contracts, down 5,356, or 1.41%, from 378,704 a week earlier.
CME data also showed that the most-active Aug cattle futures contract declined in the CFTC reporting week to settle Tuesday at $104.05 per cwt, down $3.72, or 3.45%, from $107.77.
FUNDS GO LONG CORN
For the first time since late January, managed money has a collective net long position in Chicago corn futures. Their new position as of Tuesday was long by 95,262 contracts, up from a net short position of 22,294 contracts a week earlier. This was their largest net long position since Dec. 18 when it was long by 124,427 contracts.
At the same time, commercial traders extended their collective net short position by 93,032 contracts, or 33.1%, to 373,761 contracts from 280,729 a week earlier. This was their largest net short position since June 19, 2018, when it was 395,567.
The CFTC said managed money attained its new position by adding 13,667 long positions, covering 103,889 short positions and putting on 8,266 new spread positions. This left them holding 13.8% of total long open interest, 8.5% of total short open interest and 12.3% of total spread open interest.
Commercials liquidated 9,156 long positions and added 83,876 short positions, leaving them with 28.8% of total long open interest and 49.6% of total short open interest.
CATTLE, BEEF RECAP
Cash cattle trading was reported in the Plains last week at $112 to $115 per cwt on a live basis, down $3 from the previous week. Dressed-basis trade was reported at $184, down $2.
The USDA choice cutout Friday was up $0.06 per cwt at $222.31, while select was off $0.24 at $206.92. The choice/select spread widened to $15.39 from $15.09 with 47 loads of fabricated product sold into the spot market.
The CME Feeder Cattle index for the seven days ended Thursday was $131.87 per cwt, up $0.14 from the previous day. This compares with Friday’s Aug contract settlement of $137.25, down $2.02.