Funds Cut Cattle Positions For Third Straight Week

During the week ended Tuesday, Aug. 30, large commodity funds cut their net long live cattle futures position for the third straight week as prices continued to tumble.

The Commodity Futures Trading Commission’s weekly Commitments Of Traders report Friday listed the net long live cattle position of those funds, also known as managed money, at 27,202 contracts.  This was down 13,730, or 33.5%, from 40,932 the previous week.

At the same time, commercial traders, those who theoretically could make or take delivery of a futures contract, cut their net short position for the second straight week, bring it to 62,774 contracts from 75,958 a week earlier.  This is a dip of 13,184, or 17.4%.

Managed money arrived at its new net long position by adding 806 long positions, 14,536 short positions and 100 spread positions, the CFTC said.  This left them representing 28.7% of total long open interest and 18.0% of total short open interest.

Commercials got to their new net short position by adding 3,528 long positions and covering 9,656 short positions to leave them in control of 12.5% of total long open interest and 37.1% of total short open interest, CFTC data show.

Total live cattle open interest during the CFTC reporting week rose 9,213 contracts, or 3.74%, to 255,370 contracts from 246,157, according to CME Group figures.

The CME Group also said the most-active Oct live cattle contract price continued to drop during the CFTC week to a new contract low of $105.00 on Monday before settling at $107.47 from a close of $109.72.  Close-to-close, this is a decline of $2.25, or 2.05%.  The contract has gone on to set two more new contract lows.

 

FUNDS SHORTER THAN CORN COMMERCIALS

 

Meanwhile, managed money’s net short corn position dropped below that of commercials during the latest week to 174,489 contracts from 158,486, a dip of 16,003, or 10.1%.  This is the largest net short position for these traders since the week ended April 5 when it was 175,604.

Commercials’ latest net short corn position was down 49,491 contracts, or 27.2%, to 132,171, from 181,662, the CFTC said.  This is the smallest net short position for these traders since the week ended March 8 when it was 124,611.

The CFTC said managed money arrived at its new corn position by liquidating 3,151 long positions and adding 12,852 short positions while unwinding 9,027 spreads.  This left them representing 13.4% of total long open interest and 26.8% of total short open interest.

Commercials got to their new corn position by liquidating 16,399 long positions and 65,890 short positions, leaving them in control of 26.5% of total long open interest and 36.7% of total short open interest.

Total corn open interest for the latest CFTC week amounted to 1.297 million contracts, up 73,093, or 5.33%, from 1.370 million the previous.

During the week, the most-active Dec corn contract fell to a new contract low of $3.15 ½ a bushel on Aug. 30 but closed at $3.15 ¾, a decline of $0.21 ¾, or 6.45%, from $3.37 ¼.

 

CASH CATTLE MARKETS QUIET

 

Cash cattle markets Monday were quiet after trading last week at mostly $110 per cwt on a live basis and $175 dressed.

The USDA’s choice cutout Friday was $4.65 per cwt lower at $191.09, while select was off $1.42 at $187.07.  The choice/select spread narrowed to $4.02 from $7.25 with 104 loads of fabricated product sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Thursday was $142.60 per cwt, down $0.44.  This compares with the Sep settlement Friday of $134.87, down $2.42.