DTN Early Word Livestock Comments      10/28 06:19
   Selling Pressure May Subside

   The desire to liquidate positions continued Monday. However, traders were
not able to liquidate many positions in feeder cattle due to them being locked
limit down. Hogs felt some of the pressure from cattle, but also showed
weakness in their own fundamentals.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Lower           Futures: Lower      Live Equiv: $274.49 +$1.80*

   Hogs: Higher            Futures: Mixed     Lean Equiv: $107.32 -$1.66**

   *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:

   Traders had little time to liquidate positions in feeder cattle before
prices were locked limit down the rest of Monday. There may be further
liquidation as margin calls are piling and equity is being eliminated rapidly.
Live cattle futures were able to move off limits near the end of the day,
allowing for sellers to exit their positions. Cattle futures will have expanded
limits again Tuesday. The sharp decline has struck fear into the cattle
industry, with a few Northern dressed cattle traded at $10.00 lower. Further
trade may not be quite as low, but this indicates feedlots will be willing to
move cattle at lower prices. Boxed beef was higher in both categories, with
choice up $2.12 and select up $3.69, but that is not expected to impact the
market much Tuesday. Feeder cattle prices have been melting down in recent
auctions as the fear of lower prices grips the market.