Funds Boost Long Cattle Position

Large commodity investment funds, known as managed money, increased their collective net long live cattle futures position during the week ended Tuesday as futures prices sagged.

The data came from the Commodity Futures Trading Commission’s weekly Commitments of Traders report, issued Friday for the week ended the previous Tuesday.

 

FUNDS GO LONGER

 

Already net long, managed money increased their total net long live cattle position during the week to Tuesday’s 52,397 contracts, up 8,221, or 18.6%, from 44,176 a week earlier.  It was their largest net long position since March 1 when it totaled 57,486 contracts.

During the CFTC week, the most-active Jun contract dropped, settling at $136.25 per cwt, down $0.32, or 0.23%, from $136.57.  In between, Jun hit a nearby high of $140.00 per cwt on Friday and then opening a gap on daily charts on Monday between Friday’s low of $138.35 and Monday’s opening high of $136.85.

Commercial traders, those who own, or will own, the cattle, Tuesday had a net short position of 126,255 contracts, up 6,297, or 5.25%, from 119,958 a week earlier.  It was their largest net short position since March 8 when it was 136,632 contracts.

The CFTC said managed money arrived at their new cattle position by liquidating 5,217 long positions, covering 3,004 short positions and unwinding 161 spread positions.  This left them with 28.8% of total long open interest, 11.7% of total short open interest and 8.7% of total spread open interest.

Commercials got to where they were by liquidating 4,766 long positions and adding 1,531 short positions, leaving them with 2.6% of total long open interest and 53.9% of total short open interest.

The CME Group said cattle open interest Tuesday was 305,484 contracts, down 1,107, or 0.36%, from 306,591 a week earlier.

 

FUNDS CUT LONG CORN POSITION

 

Meanwhile, managed money Tuesday had a net long Chicago corn position of 338,594 contracts, down 24,307, or 6.70%, from 362,901 a week earlier.

Commercials Tuesday had a total net short corn position of 742,016 contracts, down 18,091, or 2.38%, from 760,107 a week earlier.

The CFTC said managed money arrived at its new corn position by liquidating 20,543 long positions, adding 3,764 short positions and unwinding 4,697 spread positions.  This left them with 23.7% of total long open interest, 1.5% of total short open interest and 6.0% of total spread open interest.

Commercials got to where they were by liquidating 55,070 long positions and covering 73,161 short positions, leaving them with 22.0% of total long open interest and 70.7% of total short open interest.

 

CATTLE, BEEF RECAP

 

The USDA reported formula and contract base prices for live FOB steers and heifers last week ranged from $139.77 to $147.00 per cwt, compared with the previous week’s range of $141.47 to $143.77.  FOB dressed steers, and heifers went for $219.04 to $226.47 per cwt, versus $217.03 to $221.89.

The USDA choice cutout Friday was down $1.82 per cwt at $260.78, while select was off $3.09 at $247.97.  The choice/select spread widened to $12.81 from $11.54 with 79 loads of fabricated product and 48 loads of trimmings and grinds sold into the spot market.

The USDA reported that basis bids for corn from feeders in the Southern Plains were unchanged at $1.50 to $1.60 a bushel over the May futures and for southwest Kansas were unchanged at $0.10 over May, which settled at $8.18 1/4 a bushel, up $0.02 1/4.

Five heifer and six steer contracts were retendered for delivery Friday at one.

The CME Feeder Cattle Index for the seven days ended Thursday was $155.64 per cwt down $0.72.  This compares with Friday’s May contract settlement of $156.35, down $1.60.