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DTN Early Word Livestock Comments      08/19 06:25
   Mixed Trade Expected Ahead of Report

   Cattle futures could not hold in positive territory even though cash traded
higher as expected. Traders may have been preparing for the Cattle on Feed
report. Hogs could not find anything to grab onto with cash under pressure and
export sales were disappointing.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Higher       Futures: Higher       Live Equiv:    $194.47 -$0.12*

   Hogs: Lower          Futures: Mixed       Lean Equiv:    $127.99 +$1.44**

   *Based on formula estimating live cattle equivalent of gross packer revenue.
(The Live Cattle Equiv. 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:

   Live cattle had the cash market gain of $2.00 to $4.00 already factored in
with traders seemingly looking ahead to the Cattle on Feed report today.
Trading action might be two-sided as no one may want to position themselves
overly long or short. Packers have had to pay up to obtain the required cattle
to maintain the strong slaughter pace. It will be interesting to see what they
will be doing in the weeks to come as their margins are running substantially
below last year and are lower than the three-year average. It is unclear
whether they have been able to differ delivery of many cattle this week. Boxed
beef was mixed with choice up $0.05 and select down $0.42. Weekly export sales
totaled 18,900 MT, up 29% from the previous week with China as the largest
buyer. The Cattle of Feed report will be released this afternoon. The average
estimate for on feed supply is 100.7%, placements of 98.5% and marketings of
97.1% of a year ago.
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