Firm underlying support in early-week trade is likely to bring additional price movement into the complex Tuesday. Limited volume is expected at opening bell, creating the potential for position-taking Tuesday morning.
Cattle: Steady Futures: Mixed Live Equiv: $143.12 -0.22*
Hogs: Steady to $1 Lower Futures: Higher Lean Equiv: $ 87.96 -0.24**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Cash cattle activity remains quiet following limited movement Monday. Packer interest may slowly develop, but active bids are not likely to become readily available until midweek or later. Asking prices are still hard to pin down, but firmness in futures trade early in the week could create additional optimism in feedyard managers as they focus on market stability through the middle of June.
It appears there will be a push to get some cattle sold by midweek, especially in the South where this has become a more frequent trend the last couple of months. The strong upward shift in futures trade Monday quickly reversed market direction in live cattle and feeder cattle trade and is helping to rekindle buyer support in the entire complex.
August live cattle futures led the complex higher with a $1.35 per cwt rally. Even with the current support, nearby live cattle futures remain well below short-term resistance levels, which may keep the cattle market hovering in the sideways trading range seen last month. A move above $109 per cwt in August futures would be needed to break out of the weaker market trend seen so far this summer.