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DTN Early Word Livestock Comments      02/26 06:24
   Cattle Futures Expected to Open Lower Monday

   Livestock futures pushed higher Friday with triple-digit gains in cattle
with double-digit gains in hogs. Cattle were propelled by an increase in cash
while hogs coasted into the weekend.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Steady          Futures: Lower    Live Equiv:   $220.74 +0.51*

   Hogs: Higher           Futures: Mixed     Lean Equiv:  $96.97 -$1.03**

   *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:

   Cattle futures received a boost from higher cash trade to close out last
week. Southern cattle traded $3 higher with Northern dressed trading $4 higher.
Traders had been preparing for the Cattle on Feed report but the jump in cash
trumped the cautiousness over the report. Boxed beef was higher with choice up
$0.82 and select up $0.50. These prices continue to reflect the tightness of
the market and strong consumer demand. The Cattle on Feed report was negative
in the placement category as USDA reported placements in January were 93% of a
year ago. That was friendly due to placements being 7% lower. However, the
number is 4.8% higher than the average trade estimate. On feed numbers as of
Feb. 1 were 102% and slightly higher than the trade estimate. Marketings in
January were 100% and right in line with the estimates. The reaction will
likely push futures lower to begin the week. The Commitments of Traders report
showed funds adding 7,565 futures contracts, moving their net-long position to
54,203 contracts. Feeder cattle showed funds adding 844 long futures positions,
moving their net-long total to 7,398 contracts.
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