Funds Push Net Long Cattle Positions

Commodity investment funds, together called managed money, increased their net long live cattle futures position as the nearby Aug contract made a short-term high.

The Commodity Futures Trading Commission said in its weekly Commitments of Traders report that managed money’s net long live cattle position amounted to 19,157 contracts, up 4,943, or 34.8%, from last week’s 14,214.  In doing so, their net position rose from its lowest point since the week ended Feb. 16 when it was 11,437 contracts.

At the same time, commercial traders, those who theoretically could make or take delivery of a futures contract, trimmed their net short position to 60,855 contracts from 61,048, a decline of only 193, or 0.32%.

Managed money arrived at its new cattle position by liquidating 3,346 long positions and covering 1,597 short positions while taking on 3,831 new spread positions.  This left them representing 23.7% of total long open interest and 16.0% of total short open interest.

Commercials got to where they were by liquidating 1,590 long positions and covering 1,783 short positions, leaving them in control of 16.0% of total long open interest and 40.6% of total short open interest.

Total live cattle open interest during the week rose 5,349 contracts, or 2.21%, to 247,827 from 242,478, according to CME Group data.

During the latest CFTC week, the most-active Aug futures contract rose to a near-term high of $115.70 per cwt on Thursday before settling lower again by Tuesday, the CME Group said.  The contract went from a settlement of $112.72 to the week’s high and back down to close at $113.65.




Meanwhile, managed money continued cutting its net long corn position during the week ended Tuesday.  The CFTC reported a net corn position of 86,050 contracts, down 82,182, or 48.9%, from 168,232 the previous week and the smallest since 74,456 the week ended May 24.

Commercials, made inroads into their collective net short position, taking it down 84,444 contracts, or 17.7%, to 392,440 contracts from 476,884 the previous week, the CFTC said.

Managed money arrived at its new net long corn position by liquidating 52,425 long positions and adding 29,757 short positions and 6,583 spread positions, the CFTC said.  This left them representing 15.9% of total long open interest and 9.3% of total short open interest.

Commercials got to where they were by adding 14,731 long positions and liquidating 69,713 short positions to leave them in control of 23.3% of total long open interest and 53.7% of total short open interest.

Total corn open interest during the latest reporting week declined 43,864 contracts, or 3.29%, to 1.290 million from 1.334 million, the CME Group said.

During the week, the most-active Dec contract continued to drop sharply, going to a close of $3.58 a bushel on Tuesday from a close of $3.94 ¼.  Since then, the contract has set a new contract low and rebounded.




Cash cattle markets last week traded about $2 per cwt lower on a live basis at mostly $120 with some at $120.50 in Nebraska.  On a dressed basis, prices were about $3 to $4 lower at $191 to $192.

The USDA’s choice cutout Friday was $0.70 per cwt lower at $209.35, while select also was off $0.70 at $196.28.  The choice/select spread was unchanged at $13.07 with 89 loads of fabricated product sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Thursday was $142.92 per cwt, up $0.58.  This compares with the Aug settlement Friday of $143.45, down $0.17.