Limited activity is expected early Wednesday with traders focusing on recent wide market spreads between nearby and deferred moves in lean hog futures.
Cattle: Steady Futures: Higher Live Equiv: $152.62 +0.38*
Hogs: Steady Futures: Mixed Lean Equiv: $ 91.39 -0.51**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Firm underlying support in the entire live cattle trade Tuesday is expected to create follow-through buyer support midweek. With markets closed Friday due to Good Friday, additional market activity is expected the next two trading sessions. Strong gains in June and August futures have moved prices through April highs set in the first week of the month.
But the complex remains stuck within the wide sideways pattern established through the spring. With temperatures warming, the focus is returning to seasonal beef demand, which is expected to draw additional support.
Cash cattle activity is still undeveloped, but given the trend the last three weeks, the potential of sparking light midweek trade is on the minds of feeders and packers. Packer bids should start to develop at some point Wednesday, with asking prices becoming more readily available at current prices of $130 live and $208 dressed.