Funds, Commercials Take Longer Live Cattle Positions

Large investment funds, called managed money, and those who handle the cattle inched their net positions toward the long side during the week ended Tuesday.

The Commodity Futures Trading Commission made the revelations Friday in its weekly Commitments Of Traders report.  The report showed managed money with a net long position of 24,404 contracts, up 2,016, or 9.04%, from 22,388 the previous week.

The CFTC report also showed commercial traders, those who theoretically could make or take delivery of a futures contract, paring their net short positions by 1,069 contracts, or 1.51%, to 69,576 contracts from 70,645 during the same period.

The CFTC said managed money arrived at its new net long position by adding 2,288 long positions and 272 short positions and 310 new spread positions.  This left them representing 23.7% of total long open interest and 13.8% of total short open interest.

Commercial traders got to their new net short position by liquidating 602 long positions and covering 1,671 short positions, leaving them in control of 16.4% of total long open interest and 44.6% of total short open interest.

The CME Group said total live cattle open interest during the week declined 3,067 contracts, or 1.22%, to 247,511 from 250,578.

CME Group data also show that the most-active Aug live cattle futures contract declined $1 per cwt, or 0.87%, overall to a close on Tuesday of $115 from $116 the previous week.  The contract has declined further since then and is beginning to tickle contract lows.

 

FUNDS’ NET LONG POSITION LARGEST IN MORE THAN A YEAR

 

Meanwhile, during the same CFTC reporting week, managed money advanced its net long corn position by 44,829 contracts, or 20.1%, to 268,412 from 223,583, the CFTC said.  This is the largest net long position for these traders in more than a year, eclipsing the previous high of 247,791, set during the week ended July 21, 2015.

Commercial traders added to their already extensive net short position during the latest week, taking them to 554,842 contracts from 518,603 for a gain of 36,239, or 6.99%.  This is the second straight week commercials have taken their net short position to new heights for the year.

The CFTC said managed money arrived at its new net long corn position by adding 31,482 new long positions and covering 13,347 short positions while unwinding 18,107 spread positions.  This left them representing 23.1% of total long open interest and 5.0% of total short open interest.

Commercial traders got to their new net short positions by liquidating 15,509 long positions and adding 20,730 short positions, leaving them in control of 19.3% of total long open interest and 56.8% of total short open interest.

The CME Group said total open interest during the week rose to 1.482 million contracts from 1.467 million, for a gain of 15,048, or 1.03%.

The most-active Jul corn contract had a net gain during the week to end at $4.36 ½ a bushel from $4.27 ¾ the previous week.

 

CASH CATTLE MARKET $7 LOWER

 

Cash cattle markets last week were $7 per cwt lower at $121 on a live basis.  Dressed trades were at $197, down $9 to $10.

The USDA’s choice cutout Friday was $1.65 per cwt lower at $221.83, while select was off $3.14 at $199.61.  The choice/select spread widened to $22.22 from $20.73 with 104 loads of fabricated product sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Thursday was $144.01 per cwt, down $2.10.  This compares with the Aug settlement Friday of $137.42, down $2.20.