DTN Early Word Livestock Comments      07/16 06:13
   Hog Futures May See Buying Interest Develop

   Live cattle regained the losses of Monday on Tuesday, with some contracts
closing at new highs. Cash cattle have not yet traded, but the discount to cash
should provide further support to the market. Hog futures fell for the fourth
consecutive day, but the selling may have run its course, as they rebounded
significantly from the lows.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Steady          Futures: Higher       Live Equiv: $274.99 -$0.11*

   Hogs: Lower            Futures: Higher        Lean Equiv: $119.98 +$0.17**

   *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:

   Live cattle futures recovered the losses of Monday and then some on Tuesday
as some contracts closed at new highs. The resiliency of the market is
incredible, indicating the higher trend continues. The concern over the
strength of boxed beef is at the back of traders' minds. But the discount of
futures to cash is the focus. The increase in cattle prices last week provides
support and indicates demand remains strong. Even though boxed beef prices were
mixed Tuesday, the decline of select cuts by $2.00 offset the increase in the
gain of $0.63 in choice. Cash cattle are not expected to trade Wednesday, but I
doubt cash trading activity will wait until the end of the week as it did last
week. Feeder cattle futures seemed reluctant to regain the losses of Monday and
may be an anchor on the price potential.