Look for the cattle complex to open higher with spot August better supported than deferreds thanks to ideas of firming cash. Lean hog futures should open on a mixed basis tied to follow-through selling and late-week short-covering.
Cattle: $1-3 HR Futures: 25-50 HR Live Equiv: $138.33 – .96*
Hogs: Steady-$1 LR Futures: Mixed Lean Equiv: $ 91.64 + .49**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
GENERAL COMMENTS:
Cattle buyers may have painted themselves into a corner Friday in terms of spending for ready cattle. Packers need to make something happen in the next several hours, at least in terms of moderate trade volume. Opening bids should be around $110 live and $169 to $170 dressed.
Asking prices are around $113 to $115 in the South and $176 to $178 in the North. Live and feeder futures are likely to open somewhat higher, supported by stronger cash expectations and bull spreading.
