Sharp losses Thursday created additional concerns in the lean hog complex as traders have continued to break through support levels. Cattle markets are expected to be mixed in late-week trade with the focus on potential cash market firmness and grain market softness likely to add some momentum to morning trade.
Cattle: Steady Futures: Mixed Live Equiv: $144.23 -0.54*
Hogs: Steady to $1 Lower Futures: Lower Lean Equiv: $ 69.71 -0.44**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Cash cattle trade have once again made it to Friday morning with little interest or desire for packers and feedlot managers to meet in the middle. Even though packers remain short bought, it may be late in the day before deals are reached. Both sides seem entrenched in their position and unlikely to budge early in the day.
Asking prices are likely to redevelop at recent levels of $121 live and $196 dressed. While asking prices are holding at $126 to $127 live and $200 to $203 dressed. A price gap of $5 to $7 per cwt at this point in the week remains wide and will likely take both sides willing to move significantly to get any sales put on paper.
Cattle futures are expected to open mixed in limited activity. The narrow market shift Thursday focused on grain market weakness. The upcoming Friday morning USDA report is going to be watched closely as major implications in grain stocks could shift market prices in both grain and cattle trade.