DTN Early Word Livestock Comments      07/22 06:13
   Cattle Futures May Show Choppy Trade

   Cattle futures failed in their attempt to extend the strong gains of Monday.
Higher prices could not hold, with futures closed $1.00 or more off their
highs. Hog futures closed with minor gains, keeping the uptrend intact.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Lower           Futures: Mixed    Live Equiv: $270.40 -$1.72*

   Hogs: Higher            Futures: Higher    Lean Equiv: $111.37 +$1.72**

   *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 opened higher and traded higher for a while but slipped back
as traders were uncertain over cash trade, boxed beef, and the upcoming Cattle
on Feed report. Boxed beef prices resumed weakness on Tuesday with choice down
$3.19 and select down $1.22. This may have reduced some early optimism for
leverage for higher cash trade this week. However, with packers having some
cattle purchased ahead through the end of the month, they are in a position to
be less aggressive again this week. With packer margins in the red and boxed
beef remaining weak, they are not expected to bid aggressively for cattle. The
Cattle on Feed report will be released on Friday and may influence trade the
rest of the week. The trade estimates for the report are for on feed on July 1
at 102.2% of a year ago. Placements in June at 98.0%, and marketings during
June at 97.0%.