Expect the cattle complex to open on a firm basis, supported by follow-through buying and further short-covering. Lean hog contracts should open on a mixed basis tied to both long liquidation and cautious seasonal optimism.
Cattle: Steady-$2 HR Futures: 50-100 HR Live Equiv: $140.17 – .01*
Hogs: $1-2 HR Futures: Mixed Lean Equiv: $ 73.09 + .06**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Look for feedlot country to start floating a few preliminary bids and asking prices. Our guess is that showlists will be priced around $122 plus in the South and $192 plus in the North. Significant trade volume may be delayed until Thursday or Friday. Live and feeder futures should open at least moderately higher, girded by residual buying interest and ideas that the beef carcass value will soon be supported by seasonal demand.