DTN Early Word Livestock Comments      07/10 06:16
   Lower Cash May Trigger Further Weakness

   Cattle futures spent about the first two hours of the day in mostly positive
territory, but then they went downhill fast as lower cash trade began to
surface. Nearby hog contracts closed lower while deferred contracts found minor
support on cutout strength.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Lower           Futures: Lower     Live Equiv: $279.11 -$0.18*

   Hogs: Lower             Futures: Higher     Lean Equiv: $105.31 +$0.65**

   *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:

   Early cattle trade held some optimism that cash trade would not be as low as
some had feared. However, that was not the case as Southern live cattle traded
$7.00 lower and Northern dressed traded $10.00 lower. The downtrend in cattle
remains intact with further liquidation possible. Boxed beef prices were mixed,
with choice down $0.39 and select up $0.40. Feedlots face a decision whether
they sell the cattle that they intended to sell this week or hold for another
week and risk possible lower prices next week. Packers may be able to surround
themselves with more cattle this week to increase their leverage next week.