Large commodity investment firms, known as managed money, slashed their collective net long position live cattle futures in the week ended Tuesday as hedgers did the same to their total net short position.
The data was revealed in Friday’s Commitments of Traders report from the Commodity Futures Trading Commission.
FUNDS CUT LONG CATTLE POSITIONS
As of Tuesday, managed money had a collective net long live cattle position of 14,026 contracts, down 9,401, or 40.1%, from 23,427 a week earlier. It was their smallest net long position since Oct. 26, 2020, when it was 13,650 contracts.
Hedgers, often called commercial traders because they own, or will own, the cattle traded at the Chicago Mercantile Exchange, had a total net short position Tuesday of 92,766 contracts, down 8,610, or 8.49%, from 101,376 a week earlier. It was their smallest net short position since Nov. 2, 2020, when it was 92,137 contracts.
The CFTC said managed money arrived at their new cattle position by liquidating 5,145 long positions, adding 4,256 short positions and unwinding 3,947 spread positions. This left them holding 23.7% of total long open interest, 19.0% of total short open interest and 9.2% of total spread open interest.
Commercials got to where they were by adding 3,767 long positions and covering 4,843 short positions, leaving them with 16.4% of total long open interest and 47.7% of total short open interest.
The CME Group said total live cattle open interest Tuesday was 299,155 contracts, up 2,933, or 0.99%, from 296,222 a week earlier.
CME data also showed that the most-active Aug futures contract declined to $132.97 per cwt on Tuesday, compared with $133.47 a week earlier.
FUNDS ALSO SELL CORN
The data also showed that managed money became less long during the CFTC reporting week, ending Tuesday with a position of 267,491 contracts, down 44,874, or 14.4%, from 312,365 a week earlier. It was their smallest net long position since Oct. 26 when it was 235,207 contracts.
Commercials, Tuesday, had a net short position of 663,614 contracts, down 60,284, or 8.33%, from 723,898 a week earlier. It was their smallest net short position since Dec. 14 when it was 655,290 contracts.
The CFTC said managed money arrived at their new corn position by liquidating 26,450 long positions, adding 18,424 short positions and putting on 18,254 spread positions. This left them holding 22.0% of total long open interest, 4.7% of total short open interest and 8.3% of total spread open interest.
Commercials added 14,091 long positions and covered 46,193 short positions, leaving them with 21.6% of total long open interest and 64.6% of total short open interest.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $138.47 to $147.00 per cwt, compared with last week’s range of $138.39 to $143.41. FOB dressed steers, and heifers went for $216.01 to $218.57 per cwt, versus $216.86 to $220.73.
The USDA choice cutout Friday was up $0.61 per cwt at $267.26, while select was up $0.39 at $250.02. The choice/select spread widened to $17.24 from $17.02 with 64 loads of fabricated product and 24 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 $7.27 a bushel, down $0.03 1/4.
The CME Feeder Cattle Index for the seven days ended Thursday was $154.29 per cwt up $0.81. This compares with Friday’s Aug contract settlement of $173.87, up $0.92.