4/14/15 was UP 0.86 TO 61.87. That cuts the "Gap" to 1.23. That was a bit strong jump than the model had projected. From the noon reports show that packers were keeping their bids firm this morning so we will most likely get another move up in the component on today's kill. Taking the JJJs to cash settlement looks like it is shaping up to be a "Ho!Hum!" event.

The six-day moving average carcass weight dipped to 214.84# this morning. That is -1.00# below that same date last year. Both packer and non-packer hogs were lower in weight but the non-packer hogs dipped a bit more than packer hogs. The drop in the six-day moving average carcass weight suggests that producers have been in the liquidation phase of their market hogs. Unknown is whether this liquidation has been sufficient to off-set the batch of younger hogs that is coming in behind them. It appears that mostly traders think that it has. I say that because they have pumped the MMMs up to the point that they are trading premium to the Index by 17.54. On average over the past eleven-years the Index has gained an average of 8.31 from this date to June expiry. This suggests to me that there is a fair chance that the MMMs will retrace a bit as we move toward cash settlement. I don't have a strong bias that this will happen so I may not be a good fade yet.

I bought more K/M spreads this morning. Have taken profits on nearly half of them and am working order to take profits on the rest - - - if the market co-operates.

Best wishes,

dhm