6/26/19 was down -1.43 and the model projects the component on yesterday's kill will drop between -0.55 and -0.85.

With their lower bids, packers purchased 91.0% of the moving average of total hogs and 98.3% on the Index hogs.

This morning I added to my short NNNs because:

1. There was significant weakness between the afternoon Purchase Index and the final Purchase Index suggesting packers have decided to become more aggressive in fixing their margin problems.

2. Retailers have most likely filled their cases for the holiday and demand may weaken further.

3. On average over the past seven-years the seasonality high is hit on July 1st so there is a strong seasonal tendency for hog prices to weaken until the NNNs go to cash settlement.

4. Packers margins are so poor that they are losing about eight bucks per hog on the price of the pork and that is before they pay salaries, utilities, etc. etc. It would appear that Packers have no choice but to get their price of pork down. With the Purchase INdex being down -1.43, it appears that packers have decided to face up to reality.

Best wishes,

Doc