Large commodity index funds, known as managed money, reduced their collective net long live cattle position in the week ended Tuesday as hedgers cut their own net short position.
The data came from the Commodity Futures Trading Commission’s weekly Commitments of Traders report Friday.
FUNDS CUT LONG CATTLE POSITION
As of Tuesday, managed money’s combined net long live cattle position totaled 34,030 contracts, down 4,256, or 11.1%, from 38,286 a week earlier. It was their second week of position reductions.
At the same time, hedgers, known as commercial traders since they own, or will own, the cattle, had a collective net short position of 120,923 contracts, down 2,587, or 2.09%, from 123,510 a week earlier. It also was their second straight week of position reductions.
The CFTC said managed money arrived at their new live cattle position by liquidating 2,812 long positions, adding 1,444 short positions and putting on 6,838 spread positions. This left them with 23.3% of total long open interest, 11,8% of total short open interest and 12.7% of total spread open interest.
Commercial traders reached their new net short position by adding 1,528 long positions and covering 1,059 short positions, leaving them with 9.5% of total long open interest and 50.3% of total short open interest.
The CME Group said total live cattle open interest Tuesday was 296,599 contracts, up 10,843, or 3.79%, from 285,756 a week earlier.
CME Group data also showed that the most-active Dec contract declined in value during the CFTC week, to settle at $129.95 Tuesday, compared with $131.45 a week earlier.
FUNDS EXPAND LONG CORN POSITIONS
Meanwhile, managed money expanded their collective net long CME corn position in the week ended Tuesday, moving to 318,824 contracts, up 83,617, or 35.6%, from 235,207 a week earlier. It was their largest net long position since May 4 when it was 355,499 contracts.
At the same time, commercials had a net short position of 564,117 contracts, up 68,240, or 13.8%, from 495,877 a week earlier. It was their largest net short position since June 22 when it was 581,041 contracts.
The CFTC said managed money arrived at their new corn position by adding 75,073 long positions, covered 8,544 short positions and put on 11,430 spread positions. This left them in control of 23.0% of total long open interest, 1.8% of total short open interest and 8.8% of total spread open interest.
Commercials got to where they were by liquidating 18,273 long positions and adding 49,967 short positions. This left them holding 25.9% of total long open interest and 63.4% of total short open interest.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers last week ranged from $125.93 to $127.88 per cwt, compared with the previous week’s range of $124.70 to $127.09. FOB dressed steers and heifers went for $195.39 to $198.32 per cwt, versus $195.10 to $196.72.
The USDA choice cutout Friday was down $0.68 per cwt at $289.54, while select was down $0.70 at $267.52. The choice/select spread widened to $22.02 from $22.00 with 83 loads of fabricated product and 18 loads of trimmings and grinds sold into the spot market.
The USDA reported Friday that basis bids for corn from livestock feeding operations in the Southern Plains were unchanged at $1.30 to $1.40 a bushel over the Dec futures and for southwest Kansas were unchanged at $0.40 over Dec, which settled at $5.53 a bushel, down $0.06 1/4.
The CME Feeder Cattle Index for the seven days ended Thursday was $155.27 per cwt down $0.54. This compares with Friday’s Nov contract settlement of $158.87 per cwt, up $0.85.