Livestock traders are reentering the market following the three-day weekend and impressive cattle market gains through the end of last week. This is expected to bring about a combination of follow-through buyer support and profit-taking early Tuesday morning.
Cattle: Steady Futures: Mixed Live Equiv $139.61 +1.18*
Hogs: Steady Futures: Mixed Lean Equiv $ 67.67 -0.34**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Following the moderate cash market pressure last week and long weekend with futures markets closed Monday, packers and feeders are likely to get back into the swing of things as they focus on trade later in the week.
At this point, it is unlike there will be any active asking prices Tuesday morning, but they could start to develop through the end of the day as feedlot managers focus on taking advantage of the strong futures market rally last week combined with the bounce in wholesale beef values.
There is increased underlying support likely with the expectation that additional beef demand will continue to grow seasonally through the upcoming weeks. Packer bids are not likely to develop until later in the week with active trade expected to be pushed off until the last half of the week.
Futures trade is expected mixed in light-to-moderate morning trade. With strong market support at the end of last week, additional bullish support is likely to return to the market, eyeing the oversold cattle complex in both live and feeder cattle markets.
But the sharp rally late last week will also create a desire for traders to take profits following the $3 per cwt rally in cattle trade through the end of last week. This may create a wide mixture of price swings early Tuesday due to limited initial trade volume.
Tuesday slaughter is expected near 121,000 head.