DTN Early Word Opening Livestock 10/31 06:03
Pre-Cash Cattle Futures Expected to Open Firm
Expect live and feeder cattle contracts to open with a firm undertone,
supported by follow-through buying and ideas of no worse than steady feedlot
sales. On the other hand, lean hog futures should begin somewhat softer,
pressured by residual selling and defensive fundamentals.
By John Harrington
Cattle: Steady-$2 HR Futures: 10-30 HR Live Equiv $172.51 - 0.16*
Hogs: Steady-$1 LR Futures: 10-30 LR Lean Equiv $105.70 -$1.51**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
With processing margins still deep in the red, beef packers will not find
late week procurement chores fun work. But that doesn't mean they can be
avoided. Look for light to moderate trade volume to surface sometime between
late morning and mid afternoon. Look for opening bids to start out around
$263-264 dressed and $167-168 live, well below asking prices of $270-plus in
the North and $172-173 in the North. Live and feeder futures should open
moderately higher, supported by follow-through buying and expectations of
steady/firm feedlot business.
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