The cattle complex should open with a firm undertone thanks to follow-through buying and general cash optimism. Lean hog issues should also open with a stronger tone, supported by bullish momentum and evidence of higher cash sales.
Cattle: Steady-$2 HR Futures: 50-100 HR Live Equiv: $146.55 -.93*
Hogs: Steady-$1 HR Futures: 50-100 HR Lean Equiv: $ 83.43 -.29**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
GENERAL COMMENTS:
Although cattle buyers and sellers could find terms of compromise Thursday, something tells us we are headed toward another Friday showdown. A spread of $8 (live basis) between bids and asking prices does not exactly suggest that deal-making, asking prices should remain firm at $115 live and $183 plus dressed. Live and feeder futures should open moderately higher, supported by residual buying interest and cash market premiums.
