DTN Early Word Livestock Comments      01/05 06:08
   The Exuberance of Cattle Traders May Be Tempered Today

   Traders celebrated the New Year with aggressive buying in cattle futures.
Feeder cattle surged higher to close the next chart gaps above the market,
setting the stage for further strength. Hogs diverged with the nearby contracts
falling back and potentially ending the uptrend.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Higher          Futures: Mixed       Live Equiv: $257.98 +$2.20*

   Hogs: Lower            Futures: Higher      Lean Equiv: $100.39 +$0.83**

   *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:

   Light cash cattle trade developed late on Friday as packers needed to pay up
to purchase what was necessary to maintain slaughter. Cash cattle were reported
at $4.00 higher in Nebraska. There were some reports of packers purchasing
cattle on Saturday at $1.00 to $2.00 higher in the South. It will be an
interesting week as packers have not purchased many over the past two weeks.
Feedlots will hold with the intent to obtain higher prices, anticipating that
packers will need cattle. Live cattle broke out of its sideways trading range,
while feeder cattle easily pushed higher to close the next chart gaps that had
remained above the market. This sets a bullish tone for the year. Boxed beef
prices supported the move, with choice up $2.52 and select up $4.54.