DTN Early Word Livestock Comments      09/16 06:18
   Cattle Futures Expected to Settle Down

   Traders turned to aggressive buying Monday, but will it be enough to keep
the momentum? The potential for lower cash cattle trade this week is looming.
Hog futures were able to close with minor gains as traders are content to hold
prices at the current level.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Lower           Futures: Mixed      Live Equiv: $288.62 -$0.74*

   Hogs: Higher            Futures: Higher    Lean Equiv: $120.04 -$0.44**

   *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 regained the losses of Friday and then some in some contracts
Monday. Even though lower cash prices are expected to develop this week,
traders continue to support the market, and rightly so. Cattle supplies are
tight and that is not going to change anytime soon. The change would be if
demand for beef declines substantially due to high prices or some other
unforeseen event takes place that would impact the maket. Packers may have the
upper hand in the near term as they were able to purchase a significant amount
of cattle for deferred delivery last week. This may leave them less aggressive
in addition to bringing a slower slaughter pace. Boxed beef prices were mixed
Monday with choice down $1.51 and select up $0.36. Feeder cattle futures posted
substantial gains, but not enough to turn the trend higher.