DTN Early Word Livestock Comments      02/07 06:27
   Lower Cash Cattle Trade Expected Friday

   Cattle futures plummeted Thursday as a top is in for now. Traders are
liquidating and the record-long futures position is exaggerating the weakness.
Lower cash trade adds to the pressure. Hogs showed their resilience with early
selling being viewed as a buying opportunity. Pork cutouts were supportive.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Lower         Futures: Mixed        Live Equiv: $238.28 -$3.58*

   Hogs: Higher         Futures: Higher       Lean Equiv: $101.29 +$1.81**

   *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 topped with a vengeance Thursday. The overall fundamentals
have not changed, but the weakness of cash and the record-long futures
positions by the funds have exaggerated the move. The April live cattle
contract closed at the lowest level since Jan. 8. Cash cattle trade has been
light, but lower, adding to the pressure. Cash trade will increase Friday as
business needs to be done for the week. Feedlots may turn into more aggressive
sellers as they realize that holding for higher cash means holding cattle over
for another week and risking lower prices. Boxed beef prices were mixed
Thursday with choice down $1.36 and select up $0.44. Weekly export sales were
good at 24,900 metric tons (mt) indicating high beef prices did not turn away
international buyers. Futures may stabilize ahead of the weekend as lower cash
has been more than factored in. Feeder cattle futures have had a greater price
decline than live cattle with the March contract falling nearly $13.00 from the
high last week.