3/2/16 was up +0.18 to 67.00. With the JJJs showing a little weakness, that has closed the "Gap" to +2.30 with the JJJs being premium to the component.

The 6-day moving average carcass weight this morning was 213.23#. That is -1.38# yr/yr. Packer hogs are creeping up in weight. They are now +1.43# heavier that non-packer hogs and the index hogs were the lightest of all at 212.48#. I haven't tracked the index hog's weight separately very long but my gut feeling is that the producers of index hogs are keeping very current in their shipments. If that is the case and supply dips a little later on this spring, packers may end up bidding higher for the index hogs.

That could help the boat-load of long K/M spreads I have accumulated.

One thing is certain - I don't want to see the K/M spread crash below -8.00 like it did last year. I'm not sure I would have the fortitude to ride it out and add more looking for the recovery that we got last year because it might not come. There was very little recovery in 2012 or 2014..

Best wishes,

dhm

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