Expect the cattle complex to open on a mixed basis as traders cautiously position ahead of cash news. Lean hog contracts should also begin unevenly thanks to cash premiums on one hand and softer carcass values on another.
Cattle: Steady Futures: Mixed Live Equiv $130.82 + .54*
Hogs: Steady-$1 HR Futures: Mixed Lean Equiv $ 89.77 -1.06**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Cattle buyers and sellers have been successfully avoiding each other this week, but business necessity will surely cause some kind of hookup Friday. The tug-of-war is between tight fed supplies and poor processing margins. Look for opening bids around $116 in the South and $186 in the North, well below asking prices of $122/$190 to 192. Live and feeder futures are geared to open on a mixed basis as specs and commercial slowly position before the development of cash news.