Lean hog contracts should open at least moderately lower, checked by sinking cash values and defensive product demand. The cattle complex seems set to open higher thanks to follow-through buying and optimism.
Cattle: Steady-$2 HR Futures: 25-50 HR Live Equiv $130.83 + .09 *
Hogs: $1-2 LR Futures: 50-100 LR Lean Equiv $ 81.59 -1.77 **
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Though feedlot country could see a few preliminary bids Wednesday, we don’t expect to see enough agreement between buyers and sellers in order to generate a real market set until Thursday or Friday. Perhaps FCE business later Wednesday will give us more direction.
Look for these results to be posted on the cash cattle page as soon as possible. Live and feeder futures should open moderately higher, supported by residual buying and some degree of cash optimism.