DTN Early Word Livestock Comments      07/13 06:14
   Cattle Futures May Struggle to Find Support

   It is as if cattle futures are in free fall. Futures open higher, but turn
lower as trading progresses and liquidation continues. Hogs closed mixed, but
the pressure seemed to lack conviction.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Lower           Futures: Mixed     Live Equiv: $281.06 +$1.95*

   Hogs: Higher            Futures: Higher    Lean Equiv: $107.80 +$2.49**

   *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 continued to struggle on Friday, pressured by lower cash and
the weekend. Cash cattle finished the week with Southern cattle averaging $7.00
lower, with Northern dressed cattle $10.00 lower. With packers being able to
purchase sufficient cattle for immediate needs and some for later needs, the
prospect for steady or higher cash this week is not very good. Technically, the
market is weak, and bullish traders will need to make a collective effort to
turn the trend higher again. Boxed beef prices were higher, with choice up
$1.87 and select up $4.84. However, this may not be sufficient to turn the
trend, as demand has slowed with increased temperatures. This is seasonal and
not a surprise. Feeder cattle prices are lower as buyers follow the live cattle
market and are paying less for cattle. The Commitment of Traders report showed
fund traders reducing their net-long live cattle position by 4,532 futures
contracts to 114,908. Fund traders were net sellers of 1,041 long feeder cattle
futures, reducing their long positions to 14,566.