Live and feeder contracts should open moderately higher Monday, supported by follow-through short-covering and cash premiums. On the other hand, look for lean hog futures to open on a mixed basis thanks to a slow combination of residual selling and short-covering.
Cattle: Steady-$2 HR Futures: 50-100 HR Live Equiv $149.66 + .19*
Hogs: Steady-$1 LR Futures: Mixed Lean Equiv $ 78.48 + .46**
* 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 will limit their efforts Monday to showlist distribution and supply assessment. Last week’s trade volume totals look decent in most areas, so our guess is that the new offering will be steady to somewhat smaller. Live and feeder futures seem likely to start out moderately higher, supported by further short-covering and the reality of cash premiums.