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DTN Early Word Livestock Comments      09/27 08:31
   Futures Will React to Report Numbers

   Both the Cattle on Feed and the Hogs & Pigs report came and went. It was a
bearish cattle report and a bullish hog report. Traders have had the weekend to
digest the report and determine whether current futures have these reports
already factored in.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Steady   Futures: Lower    Live Equiv:   $223.34 -1.22*

   Hogs:  Steady   Futures: Higher   Lean Equiv:  $117.97 +6.46**

   * based on formula estimating live cattle equivalent of gross packer revenue.

   (The Live Cattle Equiv. 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


   It will be an interesting day for the cattle markets due to the Cattle on
Feed report showing on-feed numbers higher than estimated and at the second
highest numbers recorded for the month of September. Feeder cattle placement
were also bearish and above trade estimates, adding to the bearishness. Some
support might be seen from slightly better marketings, but that may not carry
much weight. How much of this has already been factored in with the large
decline since the August report, remains to be seen. Traders may feel that
futures are already in line with the market. Boxed beef prices continued lower
on Friday with choice down $2.28 and select down $0.46. Cash trade will be
quiet Monday, but with lower boxed beef and the bearishness of the report, it
is unlikely packers will be aggressive buyers this week.
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