Managed Money Boosts Net Long Cattle Positions

Managed money boosted its net long live cattle position during the week ended Tuesday while commercial traders expanded their net short positions for the fourth week.

The Commodity Futures Trading Commission reported the trade positions on Friday in its weekly Commitments of Traders report.

Managed money, or large investors, had a net long cattle position of 73,593 contracts as of Tuesday, up 4,903, or 7.14%, from 68,690 a week earlier.  This was their largest net long position since the week ended Jan. 11 when it was 81,345 contracts.

The CFTC said managed money arrived at their new cattle position by increasing long positions by 3,747 and covering 1,156 shorts while adding 3,240 spread positions.  Managed money’s long positions represented 32.1% of total long open interest while their short positions represented 5.4%.

Meanwhile, commercials, those who handle the actual cattle, increased net short positions by 4,521 contracts, or 3.74%, to 124,717 from 121,188 the week before.

The CFTC said those traders added 157 long cattle positions but overpowered this with 4,686 new short positions.  This left them representing 9.8% of total long open interest and 55.5% of total short open interest.

During the latest CFTC week, total live cattle open interest rose 6,886 contracts, or 2.56%, to 275,495 from 268,609, the Chicago Mercantile Exchange said.

During that same week, Jun futures fell to its most recent low of $157.40 per cwt on Monday before rising again on Tuesday to settle at $159.60.  That took place after a spike high on Monday, April 6, of $164.25.  So, the contract went from a nearby high on Monday to a nearby low the following Monday.




During the latest reporting week, the CFTC said managed money cut its net investment in corn futures to 63,138 short contracts from a net short position of 4,471 the week before, a drop of 58,667, or 1,312.2%.  It’s their largest net short position in years, surpassing March 17 net short position of 63,058.

However, corn commercials cut their net short positions to 165,725 contracts from 203,697 the previous week, a reduction of 37,972 contracts, or 18.6%.  This is the smallestd net short position since the week ended March 17 when it was 168,762.

The CFTC added that managed money arrived it its new corn position by selling 10,424 long contracts and 48,243 short positions, along with 13,585 spreads.  At the end of the reporting week, these speculators represented 11.9% of total long open interest and 16.4% of total short open interest.

During the same week, commercials added 29,610 long positions to their portfolios while covering 8,362 short positions.  This left them representing 24.6% of total long open interest and 36.4% of total short open interest.

Total corn open interest that week rose 50,367 contracts, or 3.70%, to 1.410 million from 1.360 million the previous week, the CME said.

The Jul corn contract declined to its most recent low of $3.70 a bushel from its close the previous Tuesday of $3.83.




Cash cattle markets last week traded down $3 to $4.50 at mostly $160 to $161 per cwt on a live basis and at $256 to $260 on a dressed basis, down $3 to $5.

The USDA’s beef cutout value Friday declined, resulting in a meager weekly rise.  Friday’s choice cutout was $257.79 per cwt, down $2.59 from Thursday and up $1.28 for the week.  Select was $250.97, unchanged from Thursday and up $1.06 for the week.

The CME Feeder Cattle Index for the seven days ended Thursday was up $1.07 per cwt to $219.47 from $218.40, compared with Friday’s settlement of the Apr futures contract at $213.00.