DTN Early Word Livestock Comments      02/05 06:20
   Livestock Futures May See Weakness

   Cattle futures may have more than factored in the higher cash trade for the
week. The optimism for higher prices is there. Hog futures took a slight
breather after the recent surge. Significantly lower pork cutouts may put
further pressure on the market.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Higher          Futures: Lower     Live Equiv: $270.15 -$2.42*

   Hogs: Lower             Futures: Lower     Lean Equiv: $98.78  -$4.37**

   *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:

   March feeder cattle futures reached up and nearly closed the chart gap. That
will likely be accomplished in the near term, but futures may see a retracement
Thursday as traders wait for the cash cattle trade. Optimism remains over
higher cash this week, but the extent of the increase is uncertain. Futures
have already factored in higher prices. Boxed beef prices took a hit Wednesday,
with choice down $2.09 and select down $5.14. Packers are desperately hoping
feedlots will need to move cattle. However, feedlots have no interest in
selling cattle at lower prices, leaving packers with no choice but to pay more.
There was an article in the Western Farm Press Daily stating that the New World
screwworm was detected in Florida. It was discovered in a horse imported from
Argentina that underwent routine inspection at an import quarantine facility.
This was reported earlier this week, but was not a threat due to the discovery.
It does underscore the importance of vigilance. The USDA AFIS website reports
there is no NWS currently in the U.S.