Hog futures seem set to open moderately lower, pressured by follow-through and long liquidation. The cattle complex should open on a mixed basis with feeders losing more ground to their live counterparts.
Cattle: Steady/Weak w/Tues Futures: Mixed Live Equiv $141.03 – .31*
Hogs: Steady Futures: 25-50 LR Lean Equiv $ 84.23 – .41**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Given the strange timing of this week’s cash cattle trade, we feel quite confident in saying that feedlot trade is done for the week. Isolated clean-up deals are possible, but price levels are certainly set. Live and feeder futures should open on a mixed basis with live issues likely to be better supported than feeder contracts.