accurately projected that the component would be nearly unchanged and it came in at +0.01 putting the component at 85.03. Now that is mighty close to unchanged! The NNNs are trading discount to the component by 1.98. Traders are banking on packers easing up on what they will pay for hogs. With the firmness of the cutouts, I thought perhaps packers would share a little with producers but I guess not.

The six-day moving average carcass weight eased to 209.44#. That is -1.87# yr/yr. Lately there have been fewer hogs coming to market than last year and they are lighter. This smaller kill rate is not what the USDA estimated. Index hogs are still lighter at 208.35# and packer hogs are heaviest of all at 210.78#. Packers brought their hogs in a little heavier yesterday while other hogs were a bit lighter.

To be sure the weather is hot and hogs finish more slowly in hot weather.

But -

Can weather alone account for the discrepancy between the kill rate and the last H&P report? I have a tendency to think NOT. Lately the H&P reports have been quite good so I'm accepting their number of market hogs as being close to correct and merely questioning the weight categories. On that basis, then, when the weather gets cooler and fresh corn starts to flow, we may see some compensatory growth take place that will bring a bunch of hogs to market in the Oct/Nov time frame.

So -

My bias is to be short the V/Z spread above 8.00. I piled one on my boat this morning and will go more if they go much above 8.00. I also bought a trio of K/Ms below -3.30. It will take some time for that trade to work for me.

Now to ask a favor of all of you patrons: Would each of you refer one other person to this web site. I think mostly the information here is good and the climate is pleasant and easy going. I don't really have much to gain from more patrons so I don't know why I ask this. Maybe I just like to build things and building this web site fits into my modus operandi.

Best wishes,

dhm