11/30/15 was up again. This time it was up +$0.15 and the model projects that the component on yesterday's kill will move up between +0.15 and +0.45. Perhaps we have touched bottom and an up-trend is now underway. Of course I thought that yesterday and the component continued to decline. Packers do have an inventory of cheaper hogs purchased and they may surprise me once again and ran a bunch of cheaper hogs through their plants yesterday. If they did, one of these days there will be a surge in the component somewhat higher than the model will project.

Cutouts were firm yesterday so packers' margins are fairly good. That's the way it needs to be if packers are going to keep their bids firm.

The action of the "Big Traders" yesterday took away most of my November gains but they seem to be coming back today especially on the short Z/G spreads. They need to tumble a bit more before I can take any of them to the bank. I may be left with some long GGGs when the ZZZs go to cash settlement and will be faced with the challenge of deciding how to handle them..

Best wishes,

dhm