Large commodity index funds, called managed money, reversed course in the week ended Tuesday and reduced their collective net short position, according to the weekly Commitments of Traders report Friday from the Commodity Futures Trading Commission.
During the week, commercial traders, those who own the cattle and primarily trade as hedgers, also reduced their collective net short position. It is rare for managed money and commercials to alter their positions in the same direction.
The new net short position of managed money as of Tuesday stood at 1,874 contracts, down from being short by 2,858 a week earlier. This was a decline of 984 contracts, or 34.4%.
Commercials on Tuesday held a collective net short position of 81,574 contracts, down 9,853, or 10.8%, from 91,427 a week earlier. It was their smallest net short position in more than a year.
CFTC data showed that managed money arrived at its new short cattle position by liquidating 6,362 long positions, covering 7,346 short positions and unwinding 10,795 spread positions. This left their net position representing 17.2% of total long open interest, 17.8% of total short open interest and 15.1% of total spread open interest.
Commercials got to their new net short position by liquidating 821 long positions and covering 10,674 short positions, leaving their position in charge of 17.2% of total long open interest and 44.5% of total short open interest.
The CME Group said total live cattle open interest as of Tuesday was 299,434 contracts, down 33,997, or 10.2%, from 333,431 a week earlier.
CME Group data also showed that the most-active Jun contract declined in value during the CFTC reporting week, settling Tuesday at $89.75 per cwt, down $9.77, or 9.82%, from $99.52 a week earlier.
FUNDS SELL CORN
During the same CFTC reporting week, managed money took on their largest collective net short position in Chicago corn futures since Dec. 17 when it was short by 95,971 contracts.
Managed money’s new net short corn position Tuesday totaled 93,839 contracts, up 41,491, or 79.3%, from 52,348 a week earlier.
At the same time, commercials cut their collective net short position by 56,557 contracts, or 22.3%, to 196,616 contracts from 253,173 a week earlier. It was their smallest net short position since Nov. 12 when it was short by 196,409 contracts.
The CFTC said managed money arrived at their new short corn position by liquidating 42,194 long positions, covering 703 short positions and unwinding 26,553 spread positions. This left them with 10.9% of total long open interest, 17.4% of total short open interest and 15.2% of total spread open interest.
Commercials got to their new position by adding 51,529 long positions and covering 5,028 short positions, leaving them in charge of 29.3% of total long open interest and 43.0% of total short open interest.
Total corn open interest Tuesday was 1.436 million contracts, down 2.66%, from 1.476 million a week earlier.
CATTLE, BEEF RECAP
Cash cattle traded in the Plains last week at $105 to $113 per cwt on a live basis, down $3 to up $3 from the previous week. Dressed-basis trade was at $170 to $175, steady to down $5.
The USDA choice cutout Friday was up $3.88 per cwt at $253.75, while select was down $0.89 at $240.17. The choice/select spread widened to $13.58 from $8.81 with 81 loads of fabricated product sold into the spot market.
The CME Feeder Cattle index for the seven days ended Thursday was $121.38 per cwt, down $0.37. This compares with Friday’s Mar contract settlement of $120.72, up $3.65, and the Apr settlement of $118.82, up $4.70.