The cattle complex is expected to open moderately lower, checked by lower cash sales and defensive carcass value. Lean hog futures seem set to trade higher in the early rounds, thanks in part to the jump in carcass value and bull-spreading interest.
Cattle: $3-5 LR Futures: 50-100 LR Live Equiv $161.19 – 1.31
Hogs: Steady Futures: 50-100 HR Lean Equiv $ 92.57 + 2.18**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Besides several thousand internet sales on the FCE (generally $3 to $4 lower), cash cattle activity on Wednesday was limited to a light volume of dressed trade in parts of the North (i.e., $210 to $215, $6 to $11 lower than last week’s weighted average basis Nebraska).
Asking prices Thursday are likely to start out around $135 to $138 in the South and $215 to $220 in the North. Live and feeder futures are likely to open moderately lower, pressured by defensive action in both cash cattle and beef cutouts.