Funds Cut Net Long Cattle Position

Managed money, or large commodity investment funds, cut their net long live cattle futures position in the week ended Tuesday as cattle owners trimmed their net short position.

The Commodity Futures Trading Commission made the revelation in its weekly Commitments of Traders report Friday.

Managed money’s new live cattle futures position as of Tuesday was 120,857 contracts, down 6,229, or 4.90%, from 127,086 the previous week, and the lowest since May 9 when it was 119,794.

As of Tuesday, commercial traders were net short live cattle futures by 205,696 contracts, off 2,855, or 1.37%, from the previous week’s 208,551.  This was their smallest net short position since May 9 when it was 204,474 contracts.

Swap dealers, those who facilitate cash or over-the-counter trades, were net long by 100,321 contracts, compared with 99,859 the previous Tuesday.  This was a gain of only 462 contracts, or 0.46%.

The CFTC said managed money arrived at its new net long position by liquidating 6,445 long contracts, covering 216 shorts and unwinding 851 spread positions.  This left them representing 34.1% of total long open interest, 2.8% of total short open interest and 11.1% of total spread open interest.

Commercial traders reached their new position by liquidating 1,300 long position and covering 4,155 short positions, leaving them in control of 6.0% of total long open interest and 59.3% of total short open interest.

Swap dealers added 346 long positions while covering 116 short positions and unwinding 116 spreads leaving them with 26.6% of total long open interest, 0.6% of total short open interest and 0.3% of total spread open interest.

The CME Group said total live cattle open interest during the week ended Tuesday fell 13,646 contracts, or 3.41%, to 386,118 from 399,764.

The most-active Aug futures contract fell to a cycle low of $113.40 per cwt from the previous Tuesday’s close of $115.90.  It then rose to a swing high of $118.80 on Tuesday before settling Tuesday at $115.02.




In the latest CFTC reporting week, managed money increased its net short corn position to 105,570 contracts from 50,327 the previous Tuesday, a gain of 55,243, or 109.8%.

At the same time, commercials cut their net short corn position to 163,527 contracts from 232,173, a decline of 68,646, or 29.6%.

Managed money arrived at its new position by liquidating 28,149 long positions, adding 27,094 shorts and unwinding 13,433 spreads, leaving them representing 16.1% of total long positions, 23.9% of total short positions and 6.7% of spread positions.

Commercials got to their new position by adding 30,520 long positions and covering 38,126 short positions, leaving them in charge of 25.7% of total long open interest and 37.7% of total short positions.




Fed cattle sales on the livestock exchange video auction Wednesday were very limited.  Two sets of heifers, totaling 320 head, sold in Kansas at $119 and $119.25 per cwt, with an average of $119.52.  This was down $3.48 from the previous week’s average of $123.00.  One group of Nebraska cattle sold at $120.

Cash cattle traded last week at $118 to $120 per cwt, mostly $119, down $3 to $4 from the previous week.  On a dressed basis, cattle traded at $189 to $190, down $6.

The USDA’s choice cutout Friday was down $1.82 per cwt at $224.73, while select was off $1.74 at $208.42.  The choice/select spread narrowed to $16.31 from $16.39 with 92 loads of fabricated product sold into the spot market.

The CME Feeder Cattle index for the seven days ended Thursday was $149.23 per cwt, up $0.53.  This compares with Friday’s Aug settlement at $147.92, up $0.75.