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DTN Early Word Livestock Comments      02/19 06:15
   Hog Futures May Show Further Gains

   Cattle traders decided to let the market float on Wednesday, waiting to see
further indications of stronger cash or continued strong beef demand. Hog
futures gained, with December and later contracts posting triple-digit gains.
Packers remained aggressive.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Higher          Futures: Higher     Live Equiv: $267.94 -$0.37*

   Hogs: Lower             Futures: Higher    Lean Equiv: $101.34 -$0.32**

   *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 closed mixed after a lackluster day. The anticipation is for
cash cattle to trade higher this week, but traders need to see greater evidence
to support that idea. It would be surprising to see cash cattle trade today, as
packers are hoping feedlots need to move cattle and will settle for steady
money with last week. Feedlots know that packers have not surrounded themselves
with many cattle. Higher offers are likely to be maintained, and packers will
need to bid up to purchase what they need. The reduced slaughter pace has not
yet resulted in the desired results of supporting boxed beef prices and backing
up cattle. Boxed beef prices on Wednesday were mixed, with choice down $0.96
and select up $0.41. Feedlots continue to pay a premium for feeder cattle due
to tight supplies.