Funds Nudge Net Long Cattle Position Higher

Large commodity funds, or managed money, nudged their collective net long live cattle futures position higher for the fourth straight week in the week ended Tuesday while commercial traders boosted their net short position for the third week.

The Commodity Futures Trading Commission said in its weekly Commitments of Traders report that managed money’s new net long live cattle position was 94,391 contracts, up 3,989, or 4.41%, from 90,402 the previous week.  It was the longest these traders have been since Aug. 1 when it was 99,357 contracts.

By contrast, commercial traders, those who theoretically could make or take delivery of a futures contract, had a net short position of 178,191 contracts, up 7,254, or 4.24%, from 170,937 the previous week.  It was their largest net short position since Aug. 8 when it was 182,602 contracts.

The CFTC’s Disaggregated Commitments of Traders report said managed money arrived at its new live cattle position by adding 2,348 long positions, covering 1,641 short positions and unwinding 4,344 spread positions.  This left them representing 31.3% of total long open interest, 3.0% of total short open interest and 7.1% of total spread open interest.

Commercial traders reached their new cattle position by adding 2,163 long positions and 9,417 short positions, to leave them with 7.9% of total long open interest and 61.3% of total short open interest.

The CME Group said total live cattle open interest during the latest CFTC reporting week declined slightly to 337,000 contracts from 338,086, a dip of 1,086, or 0.32%.

The CME Group said the most-active Dec live cattle contract was very volatile during the CFTC week.  Starting with a close of $113.47 per cwt, it rose to $115.85 on Friday, only to drop to a swing low of $112.90 on Tuesday before closing Tuesday at $114.90.

 

FUNDS HOLD SHORT CORN POSITION

 

Managed money held its net short corn position nearly flat with the previous two weeks, raising it from the previous week to bring it very close to its position two weeks ago.  Their new position as of Tuesday was short by 130,959 contracts, up 9,288, or 7.63%, from 121,671 the previous week when it was 130,902 contracts.

Commercial corn traders cut their net short corn position during the week to bring their net position back in line with their position two weeks ago, also.  Their new position is short by 197,590 contracts, down 17,952, or 8.33%, from 215,542 the previous week but nearly in line with their two-weeks-previous position of short by 199,995.

The CFTC said managed money arrived at its new corn position by liquidating 3,374 long positions, adding 5,914 short positions and putting on 4,309 spread positions.  This left them representing 15.1% of total long open interest, 24.2% of total short open interest and 6.9% of total spread open interest.

Commercials added 14,358 long positions and covered 3,594 short positions leaving them with 24.8% of total long open interest and 38.6% of total short open interest.

 

CATTLE, BEEF RECAP

 

Two lots from Texas sold at the Livestock Exchange video auction Wednesday at $108.25 and $108.50 per cwt.

Cash cattle last week traded lightly at $107 to $108 per cwt on a live basis, steady with last week, and then moved up to $109 and $110.  Dressed-basis trading was at $170 to $172, steady to down $2.

The USDA’s choice cutout Friday was down $0.03 per cwt at $197.22, while select was off $1.55 at $187.23.  The choice/select spread widened to $9.99 from $8.47 with 87 loads of fabricated product sold into the spot market.

The CME Feeder Cattle index for the seven days ended Thursday was $155.57 per cwt, down $0.64.  This compares with Friday’s Oct settlement of $153.95, up $0.37.