DTN Early Word Livestock Comments      07/14 06:20
   Cattle Futures May See Follow-through Strength

   Cattle futures pushed higher, fueled by stronger cash. The expectation of no
better than steady cash was put to rest as packers turned aggressive. Hog
futures were under pressure as the packers pulled back, resulting in
significantly lower cash.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Steady          Futures: Mixed       Live Equiv: $276.28 -$3.89*

   Hogs: Lower            Futures: Lower        Lean Equiv: $119.43 -$0.64**

   *Based on the formula estimating live cattle equivalent of gross packer
revenue. (The Live Cattle Equiv. The index has been updated to depict recent
changes in live cattle weights and grading percentages.)

   **based on formula estimating lean hog equivalent of gross packer revenue.

GENERAL COMMENTS:

   Cattle futures began Friday showing moderate strength, but that changed
quickly as cash cattle began trading. The aggressiveness of packers was
surprising, with Northern dressed cattle trading as much as $10.00 higher and
Southern live cattle as much as $6.00 higher than the previous week. This
quickly moved the August live cattle contract to a significant discount to
cash. All futures contracts for both live and feeder cattle closed at new
highs. The negative influence on the market that may create some uncertainty
today is the substantial decline of boxed beef. Choice cuts fell $6.02, with
select cuts down $4.37. This may create some confusion as to the price
direction for the week. The Commitment of Traders report showed the fund
traders adding 605 live cattle futures contracts, bringing their net-long
futures position to 123,764 contracts. They were more aggressive in feeder
cattle as they increased their long position by 3,524 contracts, bringing their
net-long futures position to a record 36,196 contracts.