Large speculators, or managed money, increased their net long live cattle positions during the week ended Tuesday, even though futures prices were plummeting.
The Commodity Futures Trading Commission, in its weekly Commitments of Traders report Friday for the week ended Tuesday, said managed money’s net long cattle position was 12,310 contracts, an increase of 3,954, or 47.3%, from 8,356 the previous week.
Commercial traders, those who theoretically could make or take delivery of a futures contract, decreased their net short positions only marginally to 30,212 contracts from 30,342 the previous week, a decline of only 130, or 0.43%.
During the same one-week period, total live cattle open interest declined 23,269 contracts, or 8.48%, to 251,098 from 274,367, the CME Group reported.
The CFTC said managed money arrived at its new net long position by adding 767 new long positions and covering 3,187 new short positions while unwinding 5,840 spread positions. This left them representing 22.8% of total long open interest and 17.9% of total short open interest.
Commercial traders arrived at their new net short positions by liquidating 5,008 long positions and adding 5,138 new short positions, leaving them representing 23.2% of total long open interest and 35.3% of total short open interest, the CFTC said.
During the latest reporting week, the most-active Feb contract dropped $9.85 per cwt, or 7.46%, to settle at $122.25 from $132.10. Along the way, it left two gaps on daily price charts and went on to set a new contract low on Thursday.
MANAGED MONEY CUTS SHORT CORN POSITION
During the same CFTC reporting week, managed money cut its net short corn position by 14,707 contracts, or 17.6%, to 69,041 from 83,748, the CFTC said.
Commercial traders, however, increased their net short corn position by 21,053 contracts, or 8.02%, to 283,683 from 262,630, the CFTC said.
The CFTC also reported that managed money arrived at its new net short position by liquidating 1,579 long positions and covering 15,286 short positions, while adding 1,851 spread positions. This left them in control of 13.4% of total long open interest and 18.8% of total short open interest.
Commercial traders arrived at their new positions by liquidating 7,512 long positions and adding 13,541 new short positions, leaving them in control of 22.4% of total long open interest and 44.5% of total short open interest.
During the latest reporting week, the most-active Mar futures contract trended higher, settling Tuesday at $3.70 a bushel, a rise of $0.03, or 0.82%, from $3.67, the CME Group said. Corn futures appeared to find a near-term bottom on Nov. 10 at $3.56 a bushel as they have trended higher ever since.
CASH FED CATTLE MARKETS QUIET AFTER MIDWEEK TRADE
Cash cattle markets were quiet Friday after an active trade on Wednesday. Live-basis prices were down $4 to $5 per cwt from last week at $118 to $119. Dressed-basis prices were off $5 to $6 at mostly $187 to $188.
The USDA Friday reported its choice beef cutout value at $202.50 per cwt, down $0.58 from Thursday. The USDA’s select cutout was $186.43, down $2.04. The choice/select spread widened Friday to $16.07 from $14.61 on Wednesday, and there were 108 loads of fabricated product sold into the spot market.
The choice cutout was only $0.10 below the $202.60 reported the previous Friday, but the select cutout was down $5.06, or 2.64%, from $191.49 the previous week.
The USDA Friday said choice rib cuts were steady while select ribs were lower. Select and choice chucks, rounds and loins were steady to weak. Trimmings were slightly lower
The CME Feeder Cattle Index for the seven days ended Thursday was $157.79, down $1.56. This compares with the Jan settlement Friday of $152.12, down $0.92.