DTN Early Word Livestock Comments      05/22 06:14
   Follow-Through Weakness Expected

   The cattle complex was hit hard on Thursday. Traders liquidated ahead of the
Cattle on Feed report and the three-day weekend. It is uncertain whether hog
futures fell in sympathy or from technical support being breached.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Lower          Futures: Mixed         Live Equiv: $89.73 -$2.22*

   Hogs: Lower            Futures: Higher       Lean Equiv: $102.09 +$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:

   Traders not only positioned themselves ahead of the report but also
aggressively liquidated positions. Some cash trade developed at steady prices
in the South and $4.00 lower in the North on a live cattle basis. This likely
set the stage for cash activity for the week. It is not that supplies have
increased and consumer demand has declined, but packers are not aggressive due
to the Memorial Day weekend. Traders were concerned over anything unexpected
that could develop over the weekend, but also the Cattle on Feed report to be
released today. The expectation for placements to be 3% above a year ago would
be negative. The range of estimates is wide as usual, from 95.7% to 108.5%. On
feed is estimated at 101.4% with a range of 100.2% to 102.4%. Cattle marketed
in April is estimated at 90.5% with a range of 89.7% to 91.7%. Boxed beef was
lower, with choice down $2.14 and select down $5.18. Feeder cattle closed limit
down, resulting in an expanded trading limit today of $13.75.