Managed money and commercial traders were nearly on the sidelines in live cattle futures market during the week ended Tuesday, even though the nearby Dec contract was gaining rapidly.
The Commodity Futures Trading Commission’s weekly Commitments of Traders report showed that managed money, or large speculators, made only small gains to their net long positions, even though on a percentage basis, the gains were huge. Commercial traders covered only a minor part of their net short positions but left themselves with the smallest net short position in more than a year.
In the report, which was released Friday, managed money increased their net long cattle positions to 2,787 contracts, up 1,578, or 130.5%, from 1,209 the previous week.
At the same time, commercial traders, those who theoretically make or take delivery of a futures contract, covered 1,429, or 6.21%, of their short positions to bring them to a net short position of 21,580 contracts from 23,009 the previous week.
The CFTC said managed money arrived at its new net long position by liquidating 3,076 long positions and covering 4,654 short positions while cutting their spread positions by 1,339. This left them in control of 19.7% of total long open interest and 18.6% of total short open interest.
Commercial traders arrived at their new net short position by selling 1,199 long positions and covering 2,628 short positions, leaving them representing 25.6% of total long open interest and 34.1% of total short open interest.
The CME Group said total live cattle open interest during the week ended Tuesday declined 5,894 contracts, or 2.26%, to 254,556 from 260,450.
During the latest CFTC week, the most-active Dec contract rose rapidly, even leaving a gap on daily price charts. The contract settled Tuesday at $140.25 per cwt, jumping $7.83, or 5.91%, from $132.42 the previous week.
MANAGED MONEY CUTS LONG CORN POSITION
During the latest CFTC reporting week, managed money cut its corn position to the smallest since June 23 when it was a net short 122,968 contracts. The latest position is net long 30,029 contracts, down 61,678, or 67.3%, from 91,707 the previous week.
At the same time, commercial traders cut their net short positions to 299,517 contracts from 338,451 the previous week, a decline of 38,934, or 11.5%.
The CFTC said managed money arrived at its new net long position by selling 18,932 long positions and adding 42,746 short positions while acquiring 3,905 spread positions. This left them in control of 16.5% of total long open interest and 14.2% of total short open interest.
Commercial traders attained their new net short position by adding 15,406 new long positions and covering 23,528 short positions. This left them representing 23.3% of total long open interest and 46.0% of total short open interest.
The CME Group reported that total open interest during the week rose to 1.320 million contracts, up 29,654, or 2.30% from 1.290 million the previous week.
The most-active Dec corn contract fell during the latest CFTC reporting week and established the latest trading cycle’s low close of $3.73 per bushel from the previous Tuesday’s settlement of $384 ½. The contract since has turned moderately higher.
CASH FED CATTLE TRADE LIGHTLY
Cash fed cattle markets in the Plains last week were lightly traded at $136 to mostly $138 per cwt on a live basis and $205 to $207 dressed, both steady to up $2 from the previous week.
Wholesale beef prices Friday were mixed, with the USDA choice cutout value at $217.17 per cwt, down $0.30 on the day, and its select cutout at $210.90, up $1.03.
The choice/select spread narrowed to $6.27 from $7.60 on Thursday, and there were 73 loads of fabricated product sold into the spot market.
The CME Feeder Cattle Index for the seven days ended Thursday was $192.80, up $0.73. This compares with the Oct settlement Friday of $195.05, down $0.50.