DTN Early Word Livestock Comments      05/08 06:05
   Cattle Futures May Rebound

   Cattle futures fell on the open and then regained much of the losses, only
to fall back into the close. Contracts posted a wide price swing. Hog futures
were not quite as volatile, but managed to close higher in deferred contracts.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Higher          Futures: Higher      Live Equiv: $286.67 -$2.46*

   Hogs: Higher            Futures: Mixed      Lean Equiv: $101.92 +$0.50**

   *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 showed exceptional volatility, with live cattle futures
having a trading range of around $6.00, while feeder cattle showed a range of
about $7.00. It was uncertain as to why this volatility developed. Futures
opened slightly lower and then fell like a rock, spending the next few hours
trying to regain the losses, only to fall back into the close. Trading today
will show whether this was an aberration or a sense of reality. Some light cash
trade took place on Thursday at $2.00 to $3.00 higher, likely setting the stage
for today. However, boxed beef fell on Thursday with choice down $2.68 and
select down $5.21. The question for today will be whether traders focus on cash
trade or boxed beef. Boxed beef is the driver of the market as it represents
demand.