Look for hog paper to start out in the red, pressured by wholesale pork demand overwhelmed by late-year tonnage. On the other hand, cattle futures should begin in cautious mode as traders await one side or the other to blink first in the cash market.
Cattle: Steady Futures: Mixed Live Equiv: $140.98 – 1.45*
Hogs: Steady-$1 LR Futures: 50-100 LR Lean Equiv: $ 76.52 – 1.18**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
The cash hog trade continues to bleed lower, steadily drained by a combination of record pork production and insufficient product demand. Assuming Saturday’s kill comes close to 250,000 head, the weekly total should easily exceed 2.6 million. Lean futures seem geared to open moderately lower, checked by residual selling and disappointing fundamentals.