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DTN Early Word Livestock Comments      05/20 06:12
   Cattle Find Strong Support

   Feedlots received what they wanted as higher cash trade unfolded late last
week. Both cash and boxed beef provided the support. Hogs could not find any
support with new lows again as traders continued to liquidate long positions.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Steady           Futures: Higher    Live Equiv: $229.17 +$2.52*

   Hogs: Steady            Futures: Mixed     Lean Equiv: $106.71 +$0.62**

   *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 could not help but increase as cash cattle traded higher
Friday. Feedlots held out for higher cash and received it. Northern dressed
cattle traded as much as $5.00 higher with Southern live cattle trading $2.00
higher. It appeared cash would be stronger but it was not expected to see these
gains. But when boxed beef prices continued to increase, packers had to step up
to purchase the cattle needed to meet demand. This may not be repeated this
week as the buying ahead for Memorial Day weekend may be finished. Live cattle
futures broke through chart resistance which may increase further technical
buying. The Commitments of Traders report showed traders adding 966 contract,
bringing their net-long futures positions to 41,720 contracts. Feeder cattle
moved to a net-long futures position of 4,411 contracts, an increase of 508
futures contracts.
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