DTN Early Word Livestock Comments      06/03 06:05
   Cattle Futures May See Further Weakness

   Cattle futures showed weakness from the news of cases of the New World
screwworm closer to the U.S. and the potential for lower cash cattle trade this
week. Hog futures struggled for a while, but finally found footing to post
gains for the day.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Lower          Futures: Lower       Live Equiv: $290.75 +$0.98*

   Hogs: Steady           Futures: Higher      Lean Equiv: $107.23 +$0.84**

   *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:

   Live cattle futures did not spend any time in positive territory on Tuesday
amid news of the New World screwworm. It was discovered about 25 miles from the
border, resulting in renewed concerns about its potential to move into the U.S.
The news put traders on edge, and liquidation took place to limit exposure in
the market. There is the potential for cash cattle to trade lower this week,
adding to the uncertainty. Fund traders hold a significantly long futures
position, and there may be further interest in reducing those positions as
uncertainty increases. Boxed beef prices were higher, with choice up $1.24 and
select up $1.72. Feeder cattle futures opened lower and never looked back.
Feeder cattle sales have shown weakness as buyers take a wait-and-see attitude
for a little while.