dropped -0.48 to 55.88 and that represents 50% of the cash settlement index. The down trend has once again set in. Packers purchased 131.3% of the moving average daily purchases on Friday. This seems to suggest the the kill is going to be firm for the rest of this week. The last H&P report seems to suggest that it will be several weeks before there is a significant drop in the kill rate.

Demand does not seem to be strong enough to drive the index up today and give us a bump at cash settlement.

The 6-day moving average carcass weight firmed to 214.73#. It was mostly the non-packer hogs that were heavier. Packers seem to be liquidating their market hogs faster than the non-packers. The packer hogs are only running 1.16# heavier than the non-packer hogs. Packers are closer to the market than I and this may be telling us something if they are moving their hogs to market at a brisk clip.

I'm going in cash settlement flat the ZZZs. This is the first time in quite a while that I have not had some contracts to go to cash settlement.

I'm not getting much done today but I did get to take a quick trip to the bank by taking profits on a long V6/Z6 spread trade that has been lounging around since 10/29/15. I have a nice inventory of spread scattered across the deck of my boat but have plenty of space to add more if the market co-operates. I would like to add a couple of long Q/V spreads at 8.125. We are through the Goldman Roll so spreads may be calm today.

Best wishes,

dhm