Large commodity index funds, known as managed money, cut their collective net long live cattle futures position for the third straight week in the week ended Tuesday as hedgers trimmed their net short positions.
The data came from the Commodity Futures Trading Commission’s weekly Commitments of Traders report Friday, which lists the collective trading positions of four types of traders as of the previous Tuesday.
FUNDS SELL CATTLE
As of Tuesday, managed money was net long by 50,688 contracts, down 7,729, or 13.2%, from 58,417 a week earlier. It was their smallest net long position since June 8 when it was 50,427 contracts.
At the same time, hedgers, those who own, or will own the cattle at some point and are known as commercial traders, held a collective net short cattle position of 144,369 contracts, down 7,407, or 4.88%, from 151,776 a week earlier. It was their smallest net short position since June 8 when it was 142,601 contracts.
The CFTC said managed money arrived at their new net long cattle position by liquidating 5,350 long positions, adding 2,379 short positions and unwinding 131 spread positions. This left them with 25.7% of total long open interest, 8.6% of total short open interest and 11.3% of total spread open interest.
Commercials got to where they were Tuesday by adding 2,197 long positions and covering 5,210 short positions, leaving them with 8.0% of total long open interest and 56.5% of total short open interest.
The CME Group said total live cattle open interest Tuesday was 297,188 contracts, down 4,088, or 1.36%, from 301,276 a week earlier.
CME Group data also showed that the most-active Oct contract declined in value during the CFTC reporting week to settle Tuesday at $127.17 per cwt, compared with $128.15 a week earlier.
FUNDS SELL MORE CORN
For the sixth straight week, managed money sold corn futures, reducing their collective net long position. As of Tuesday, their new position totaled 204,888 contracts, down 12,522, or 5.76%, from 217,410 a week earlier.
Commercials cut their net short position for the sixth straight week, too, bringing them to 526,203 contracts, down 14,111, or 2.61%, from 540,314 a week earlier.
The CFTC said managed money arrived at their new net long corn position by liquidating 18,391 long positions, covering 5,869 short positions and putting on 12,260 spread positions. This left their positions representing 16.5% of total long open interest, 2.8% of total short open interest and 12.0% of total spread open interest.
Commercials got to where they were Tuesday by adding 269 long positions and covering 13,842 short positions, leaving them with 26.8% of total long open interest and 62.0% of total short open interest.
CATTLE, BEEF RECAP
Fed cattle traded last week at $119 to $125 per cwt on a live basis, steady to down $1 from the previous week. Dressed-basis trade was at $196 to $201, steady to down $1.
The USDA choice cutout Friday was down $1.93 per cwt at $267.94, while select was off $0.69 at $251.79. The choice/select spread narrowed to $16.15 from $17.39 with 111 loads of fabricated product and 32 loads of trimmings and grinds sold into the spot market.
The USDA reported Friday that basis bids for corn from livestock feeding operations in the Southern Plains were unchanged at $1.07 to $1.15 a bushel over the Sep futures and for southwest Kansas were unchanged at $0.70 over Sep, which settled at $5.56 a bushel, down $0.08 1/4.
The CME Feeder Cattle Index for the seven days ended Thursday was $151.39 per cwt down $0.96. This compares with Friday’s Aug contract settlement of $155.62 per cwt, down $1.75.