5/3/16 was up 0.94 to 73.08. The jump in the index and the dip of the MMMs has cut the "Gap" to 8.74 with the MMMs being premium to the component. By historical standards, that is still quite a "Gap" to be closed by the Index moving up. History seems to suggest that the MMMs are going to take a bit more of a hair cut but history doesn't decide. It is the supply/demand situation here and now that decides and demand seems to be holding up quite well. For that matter, so is supply.

So far this week the kill is +2.78% over last year and the hogs are +0.72# year/year.

It is not the BELLIES side of demand that is strong. They gave up 8.16 yesterday and Dewey didn't get to trade 'em. 'Twas a sad day when the closed the belly pit.

The afternoon reports yesterday seemed to indicate that packers were bidding strong again yesterday for hogs. This firmness may continue until they meet their kill needs for the Memorial Day holiday trade. I guess I'm counting on it because I still have a cargo of K/M spreads to get off my boat,

There are only seven more trading days for me to sweat the K/M spread and it often gets awful spunky just before it dies. Last year it jumped three points and the year before that it coughed up five. I'm really not prepared for a five-point haircut!

Best wishes,

dhm