Managed Money Reverses, Buys Live Cattle Futures

Large commodity index funds, called managed money, reversed trend in the week ended Tuesday, advancing their collective net long live cattle futures position, while hedgers reduced their total net short position.

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

 

FUNDS BUY CATTLE

 

Managed money Tuesday had a collective net long live cattle position of 17,852 contracts, up 980, or 5.81%, from 16,872 a week earlier.  It was their first week of extending their long position after 16 weeks of declines.

At the same time, those hedgers, known as commercial traders since they also deal with the cattle, had a total net short live cattle position of 80,869 contracts, down 2,328, or 2.80%, from 83,197 the week before.

The CFTC said managed money arrived at their new cattle position by adding 4,399 long positions, 3,419 short positions and 1,579 spread positions.  This left them holding 16.7% of total long open interest, 10.1% of total short open interest and 17.0% of total spread open interest.

Commercials got to where they were Tuesday by liquidating 739 long positions and covering 3,067 short positions, leaving them with 17.7% of total long open interest and 47.7% of total short open interest.

The CME Group said total live cattle open interest Tuesday was 268,113 contracts, up 2,933, or 1.11%, from 265,180 a week earlier.

CME data also showed that the most-active Feb live cattle contract rose in value during the CFTC-reporting week to settle at $171.92 per cwt, compared with $170.40 a week earlier.

 

MANAGED MONEY SELLS CORN

 

Managed money Tuesday had a collective net short Chicago corn position of 200,949 contracts, up 28,934, or 16.8%, from 172,015 a week earlier.

Meanwhile, commercial traders had a total net short position of 11,234 contracts, down 18,362, or 62.0%, from 29,596 a week earlier.

The CFTC said managed money arrived at their new corn position by liquidating 11,712 long positions, adding 17,222 short positions and putting on 18,318 spread positions.  This left them in control of 12.2% of total long open interest, 27.3% of total short open interest and 14.8% of total spread open interest.

Commercials got to where they were Tuesday by adding 15,605 long positions and covering 2,757 short positions, leaving them with 30.1% of total long open interest and 30.9% of total short open interest.

The CME Group said total corn open interest Tuesday was 1.306 million contracts, up 29,075, or 2.28%, from 1.277 million a week earlier.

The most-active Mar contract declined in value during the CFTC-reporting week, settling Tuesday at $4.63 ¾ a bushel, down from $4.80 ¼ a week earlier.

 

CATTLE, BEEF RECAP

 

The USDA reported formula and contract base prices for live FOB steers and heifers last week ranged from $172.00 per cwt to $175.59, compared with the previous week’s range of $171.19 to $174.19 per cwt.  FOB dressed steers, and heifers went for $269.19 per cwt to $274.88, compared with $267.22 to $271.38.

The USDA choice cutout Friday was up $1.26 per cwt at $277.16 while select was up $0.71 at $259.53.  The choice/select spread widened to $17.63 from $17.08 with 79 loads of fabricated product and 27 loads of trimmings and grinds sold into the spot market.

The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $1.25 to $1.35 a bushel over the Mar corn contract, which settled at $4.60 3/4 a bushel, down $0.05 3/4.

The CME Feeder Cattle Index for the seven days ended Thursday was $228.09 per cwt, down $0.56.  This compares with Friday’s Jan contract settlement of $223.12, down $1.55.