Look for the cattle futures to begin with uneven price action thanks to a combination of residual selling and pre-cash short-covering. Lean hog issues should also open on a mixed basis tied to follow-through selling on one hand and renewed signs of fundamentals on the other.
Cattle: Steady Futures: Mixed Live Equiv: $147.54 +.37*
Hogs: Steady-$1 HR Futures: Mixed Lean Equiv: $ 82.35 + .84**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Feedlot country will probably remain in slow gear Tuesday with bids and asking prices poorly defined. Assuming that nearby live futures at least remain in their lateral ranges, significant trade volume may be delayed until the second half of the week.
Given the continuation of outstanding packer margins, there should be no problem in weekly slaughter totaling 655,000 head or better. Live and feeder futures are set to open on a mixed basis thanks to both spillover selling and short-covering.