Large investment firms, called managed money, are closing in on a zero net live cattle futures position with their tenth straight week of long liquidation, according to the Commodity Futures Trading Commission.
The CFTC’s weekly Commitments of Traders report said managed money’s new net long live cattle position was 11,431 contracts, down 3,956, or 25.7%, from 15,387 the previous week and down 91,847, or 88.9%, from their most recent high of 103,278 on Tuesday, Feb, 20. It was their lowest position in more than a year.
Commercial traders, those who raise the cattle, had a net short position of 108,006 contracts, down 4,242, or 3.78%, from 112,248 the previous week and down 89,399, or 45.3%, from their most recent high of 197,405 on Feb. 20. This was commercials’ lowest net short position in more than a year.
The CFTC said managed money arrived at its new cattle position by liquidating 2,888 long positions while adding 1,068 short positions and placing 3,383 new spread positions. This left them representing 21.5% of total long open interest, 18.2% of total short open interest and 12.8% of total spread open interest.
Commercial traders got to their new cattle position by liquidating 157 long positions and covering 4,399 short positions. This left them in control of 12.5% of total long open interest and 43.2% of total short open interest.
The CME Group said total live cattle open interest rose during the week ended Tuesday to 351,278 contracts from 346,785 the previous Tuesday. This was a gain of 4,493, or 1.30%.
Data also showed the most-active Jun live cattle contract rose during the week to close Tuesday at $105.82 per cwt from $105.05 the previous Tuesday.
FUNDS GOES LONG CORN
After three weeks of net long liquidation, managed money reinvested in CME Group corn futures during the week ended Tuesday. The new net long position not only reversed direction but exceeded the three-week-old high, bring their collective net long position to its largest since Tuesday, March 20 when it was 207,376 contracts.
Managed money’s new net long corn position was 186,276 contracts, up 72,158, or 63.2%, from 114,118 the previous week.
Meanwhile, commercial traders re-extended their net short corn position to 582,145 contracts, up 65,538, or 12.7%, from 516,607 the previous Tuesday. It was their largest net short position since March 13 when it was 596,587 contracts.
Managed money arrived at its new corn position by adding 40,024 long positions, covering 32,134 short positions and unwinding 17,377 spread positions, leaving them with 19.4% of total long open interest, 8.8% of total short open interest and 8.2% of total spread open interest.
Commercials liquidated 47,061 long positions and added 18,477 shorts to leave them holding 19.8% of total long open interest and 53.1% of total short open interest.
CATTLE, BEEF RECAP
Out of 2,982 fed cattle presented, 413 sold Wednesday on the Livestock Exchange Video Auction, all for 1- to 9-day delivery, at $122.40 per cwt. There were no sales the previous Wednesday.
Cash trading last week was at $125 to mostly $126 per cwt on a live basis, compared with mostly $124 to $126 last week. Dressed-basis trading was reported at $195, steady to down $3 from last week.
The USDA choice cutout Friday was up $0.74 per cwt at $228.30, while select was up $0.32 at $209.49. The choice/select spread widened to $18.81 from $18.39 with 78 loads of fabricated product sold into the spot market.
The CME Feeder Cattle index for the seven days ended Thursday, was $137.90 per cwt, down $0.21. This compares with Friday’s May close of $140.40, down $0.40.