Large commodity index funds, known as managed money, cut their collective net long live cattle futures position in the week ended Tuesday as hedgers slashed their total net short position.
The information came from the Commodity Futures Trading Commission’s Commitments of Traders report Friday, showing that investors were getting out of live cattle futures as prices tumbled.
MANAGED MONEY SELLS CATTLE
As of Tuesday, managed money’s collective net long live cattle position stood at 27,773 contracts, down 8,040, or 22.4%, from 35,813 a week earlier. It was their lowest net long cattle position since Oct. 5 when it was 21,787 contracts.
Hedgers, more broadly known as commercial traders since they own, or will own, the cattle had a total net short position Tuesday of 105,146 contracts, down 9,178, or 8.03%, from 114,324 a week earlier. It was their smallest net short position since Nov. 24, 2020, when it was 104,870 contracts.
The CFTC said managed money arrived at their new cattle position by liquidating 2,010 long positions, adding 6,030 short positions and putting on 1,642 spread positions. This left them holding 25.4% of total long open interest, 16.4% of total short open interest and 10.8% of total spread open interest.
Commercials got to where they were by adding 3,043 long positions and covering 6,135 short positions, leaving them in charge of 14.4% of total long open interest and 48.4% of total short open interest.
The CME Group said total live cattle open interest Tuesday was 308,712 contracts, down 1,267, or 0.41%, from 309,979 a week earlier.
CME data also showed that the most-active Aug contract fell during the CFTC reporting week to $134.10 per cwt, compared with $137.32 a week earlier.
FUNDS SELL CORN
As of Tuesday, managed money’s total net long Chicago corn position was 313,391 contracts, down from 327,802 a week earlier, a decline of 14,411, or 4.40%.
Commercials Tuesday had a net short position of 703,999 contracts, down from 747,181 a week earlier, for a drop of 43,182, or 5.78%.
The CFTC said managed money arrived at their new corn position by liquidating 4,784 long positions, adding 9,627 short positions and putting on 19,786 spread positions. This left them with 23.6% of total long open interest, 2.9% of total short open interest and 7.4% of total spread open interest.
Commercials got to where they were Tuesday by adding 8,389 long positions and covering 34,793 short positions, leaving them with 21.2% of total long open interest and 67.8% of total short open interest.
The CME said total corn open interest Tuesday was 1.510 million contracts, versus 1.514 million a week earlier.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers last week ranged from $140.00 to $158.23 per cwt, compared with the previous week’s range of $137.25 to $147.00. FOB dressed steers, and heifers went for $220.11 to $225.73 per cwt, versus $220.50 to $228.60.
The USDA choice cutout Friday was up $1.75 per cwt at $258.95, while select was down $0.46 at $243.90. The choice/select spread widened to $15.05 from $12.84 with 71 loads of fabricated product and 21 loads of trimmings and grinds sold into the spot market.
The USDA reported that basis bids for corn from feeders in the Southern Plains were unchanged at $1.55 to $1.65 a bushel over the Jul futures and for southwest Kansas were steady at even the Jul, which settled at $7.81 1/4 a bushel, down $0.10 1/4.
The CME Feeder Cattle Index for the seven days ended Thursday was $156.36 per cwt down $0.25. This compares with Friday’s May contract settlement of $157.87, up $1.00.