Funds Still Cutting Live Cattle Position

Large commodity investment funds, called managed money, lowered their collective net long live cattle position for the eighth straight week during the week ended Tuesday as commercial traders cut their net short position for as many weeks.

The Commodity Futures Trading Commission, in its weekly Commitments of Traders report Friday said managed money’s new net long cattle position was 92,753 contracts, down 6,604, or 6.65%, from 99,357 the previous week.

Commercial traders, those who own the cattle at some point in their lives, had a new net short position of 182,602 contracts, down 6,135, or 3.25%, from 188,737 the previous week.

Swap dealers, those who facilitate cash or over-the-counter trades, had a new net long position of 96,442 contracts, down 2,435, or 2.46%, from 98,877 the previous week.

The CFTC said managed money arrived at its new live cattle position by liquidating 3,493 long positions, adding 3,111 short positions and unwinding 5,677 spreads.  This left them representing 32.5% of total long open interest, 4.0% of total short open interest and 5.9% of spread open interest.

Commercial traders got to their new live cattle position by liquidating 2,137 long positions and covering 8,272 short positions, leaving them in control of 7.6% of total long open interest and 63.6% of total short open interest.

Swap dealers unloaded 2,324 long positions, added 111 short positions and unwound 1,624 spread positions, leaving them holding 30.5% of total long open interest, 1.0% of total short open interest and 0.8% of total spread open interest.

The CME Group said total live cattle open interest during the CFTC reporting week was down 26,114 contracts, or 7.41%, to 326,447 from 352,561.

During the CFTC week, the most-active Oct live cattle contract moved lower, ending at $110.60 per cwt, down from $112.87.  However, during the week, the contract moved up to set a swing high of $115.60 on Thursday before falling into Tuesday’s close.




Meanwhile, managed money also cut its net long CME corn futures position during the week ended Tuesday.  It was the fifth straight week of cuts.

Managed money’s new net long corn position was 63,682 contracts, down 17,761, or 21.8%, from 81,443 the previous week.

Commercial traders also trimmed their net short corn position to 338,681 contracts, from 337,305, a decline of 1,376 contracts, or 0.41%.

The CFTC said managed money arrived at its new corn position by liquidating 12,901 contracts, adding 4,860 short positions and 5,494 spread positions, leaving them with 16.8% of total long open interest, 12.3% of total short open interest and 6.4% of total spread open interest.

Commercials liquidated 8,308 long positions and covered 6,932 shorts, leaving them with 25.0% of long open interest and 49.3% of short open interest.




The weighted average of fed cattle sold on the livestock exchange video auction Wednesday was $115.04 per cwt, down $0.96 from $116.00 the previous week.  Cattle with 1- to 9-day delivery sold at $115.28, versus $116 the previous week.  Those with 1- to 17-day delivery sold at $114.50, and cattle with 17- to 30-day delivery sold at $114.00.

Cash trading took place last week at $114 to $116 per cwt on a live basis, mostly $115, down about $2 from the previous week.  Dressed action was reported at $184 to $185, down about $2.

The USDA’s choice cutout Friday was down $1.03 per cwt at $199.60, while select was off $0.07 at $196.12.  The choice/select spread narrowed to $3.48 from $4.44 with 65 loads of fabricated product sold into the spot market.

The CME Feeder Cattle index for the seven days ended Thursday was $145.96 per cwt, down $1.97.  This compares with Friday’s Aug settlement at $141.77, up $0.60.