Cattle Futures See 12th Week Of Fund Liquidation

The live cattle futures market saw its 12th straight week of fund liquidation during the week ended Tuesday as commercial traders trimmed their net short position for as many straight weeks.

The Commodity Futures Trading Commission said in its weekly Commitments of Traders report Friday that managed money, those large commodity funds, cut their net long live cattle position by 3,.095 contracts, or 3.98%, to 74,667 from 77,762 the previous week.  The new total was down 54,257, or 42.1%,from the latest peak of 128,924 contracts the week ended June 13.

Commercial traders, those who theoretically could make or take delivery of a futures contract, trimmed their net short cattle position to 160,226 contracts, from 162,444 the previous Tuesday, a decline of 2,218, or 1.37%.  The new total was down 51,806 contracts, or 24.4%, from the latest high of 212,032 the week of June 13.

The CFTC reported that managed money reached its new live cattle position by liquidating 2,492 long positions and adding 603 short positions while placing 2,142 spread positions.  This left them representing 29.5% of total long positions, 5.8% of total short positions and 7.4% of total spread positions.

Commercial traders got to where they were by liquidating 702 long positions, and covering 2,920 short positions, leaving them in control of 7.9% of total long open interest and 58.7% of total short open interest.

The CME Group said total live cattle open interest during the CFTC reporting week declined 1,147 contracts, or 0.36%, to 315,389 from 316,536.

The CME Group also reported that the most-active Oct cattle contract declined during the CFTC week to close at $104.42 per cwt from $106.10, a dip of $1.68, or 1.58%.

 

FUNDS ALSO CONTINUE SELLING CORN

 

Along with selling live cattle futures positions, managed money also continued selling corn futures, expanding their net short position in the process.

The CFTC reported that managed money’s new corn position was net short by 103,898 contracts, up 40,366, or 65.5%, from 63,532 the previous week.

Meanwhile, commercial traders continued to cover their net short positions, going to 222,473 contracts during the week ended Tuesday from 229,425 the previous week, a decline of 6,952, or 3.03%.

The CFTC said managed money arrived at its new net short CME corn position by liquidating 4,846 long positions, adding 35,520 short positions and unwinding 5,416 spread positions.  This left them representing 16.1% of total long open interest, 23.9% of total short open interest and 6.8% of total spread open interest.

Commercial traders got to their new corn position by liquidating 22,833 long positions and covering 29,785 short positions, leaving them in control of 25.0% of total long open interest and 41.6% of total short open interest.

The CME Group reported that the most-active Dec corn contract had a net gain during the week to $3.58 ½ a bushel from $3.48 ¾.

 

CATTLE, BEEF RECAP

 

Only one lot of cattle sold Wednesday on the livestock exchange video auction at $163 per cwt on a dressed basis, down $3 from the previous week.

Grudging cash trading was reported last week at $105 per cwt on a live basis, steady to up $1 from the previous week and at $163 dressed, down $2 to $3.

The USDA’s choice cutout Friday was down $0.25 per cwt at $191.88, while select was off $0.19 at $189.97.  The choice/select spread narrowed to $1.91 from $1.97 with 119 loads of fabricated product sold into the spot market.

The CME Feeder Cattle index for the seven days ended Thursday was $148.24 per cwt, up $1.19.  This compares with Friday’s Sep settlement of $147.87, up $2.32.