DTN Early Word Livestock Comments      05/14 06:41
   Livestock Futures Could Bounce

   Feeder cattle did not quite feel the pressure of the rest of the complex due
the weakness of grain futures, but Thursday was not a good day. It may be
difficult to recover the losses in the near-term as traders have become
increasing cautious. Futures could bounce as the reaction Thursday to the news
subsides.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Steady   Futures: Mixed   Live Equiv:   $231.01 +0.39*

   Hogs:  Lower    Futures: Mixed   Lean Equiv:  $122.78 +2.01**

   * 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:

   It was an ugly day Thursday with futures falling in all categories of the
livestock complex. Live cattle were hit hard, eliminating basically all of the
gains of the week. Plummeting grain prices had no influence as the cattle
market was trumped by the rumor of a major beef plant not running a Saturday
slaughter schedule. This is a bit confusing due to strong boxed beef prices and
slaughter weights declining. One would think packers would want to process
cattle in order to meet demand and take advantage of the phenomenal price
spread between cash and boxed beef. Maybe the substantial profits being made
are allowing them to take some time off. Prior to that rumor surfacing, the
dismal exports sales report of only 13,100 metric tons of sales, which were
down 22% from last week and down 35% from the four-week average, set the stage
for lower futures. The drop in futures will be difficult to regain as those
traders who recently bought into the market got burnt and may remain sidelined.