9/15/16 was down -$0.53 and the model projects that the component on yesterday's kill will plunge by -0.30 and -0.60.. The VVVs settled last night discounted to the component by -8.21. That is an industrial strength "Gap" but packers know how to close "Gaps" like. Considering the weakness in the cutouts yesterday, the firm kill rate and the rising 6-day moving average carcass weight, traders just may know what they are doing in building such a very wide "Gap" into the price of the VVVs.

For now I will cling to the short VVVs that I have. Yesterday I covered a bunch of short V/Z spreads and was also able to re-sell some of them. It isn't often that I get to make a round trip with a spread in one-day.

I have piled a bunch of the long Q7/V7 spreads on my boat. I would like to start moving a few of them out but will add more if they dip a little. Generally the long Q/V spreads treat me quite well but this batch may take more than the usual amount of patience.

Best wishes,

dhm