12/15/15 was down -0.35 to 55.71. That cuts the premium of the GGGs over the component to 2.29. With as much time as there is to get to cash settlement, that is not very meaningful.

The six-day moving average carcass weight continued to drift lower to 214.29#. That is -1.21# year/year and a mere +0.97# over the same date in 2013. My thoughts are that producers are getting quite current in their shipments and it is especially the packers that are getting current. Packer hogs are only 0.61# heavier than the non-packer hogs and they were nearly 5.0# heavier.

I don't believe weather has been severe enough to hamper hogs finishing so there is a good chance that the high kill rate lately represents some liquidation of market hog inventory by producers especially in the packer-owned category. This might be setting the stage for a nice rally in the CME Index during the later part of January if the kill rate declines as the last H&P report suggests.

I don't think we will get a crash of nearly 25-points like we got last year as the GGGs moved toward cash settlement.

So -

I have tucked two GGGs away and am going to hand on with bull dog tenacity like Dewey and see what happens. Maybe some good fortune with some spread trades will cushion the loss if this turns out to be an error of judgement.

Best wishes,

dhm