12/5/16 was up +0.42 to 51.30. The ZZZs are now trading premium to the component by +1.72. It appears that traders are thinking packers are getting hungry for hogs. The data may be backing them on on that.'

The 6-day moving average carcass weight was a little weak this morning at 212.08#. That is -2.02# year/year. Packers have run their hogs up to the point that they are +3.5# heavier than the non-packer hogs. It looks like the packers may have seen a tight supply of hogs coming up. Both packer and non-packer hogs were lighter by nearly 1/2#. These higher bids that packers are throwing out there may be pulling hogs forward a bit right now. Index hogs were steady at 211.49#.
m
I try to project packers national average cost of carcasses. My number this morning was 52.91. With cutouts yesterday at 74.06, it appears to me that packers have a very good reason to be wanting pork to peddle. It seems to me that the margin for packers is quite healthy now.

STill long the ZZZs and GGGs and short some naked 51 puts. Have had to make several trips to the bank this morning as some calendar spreads that have been on my boat for far too long have started to move. Maybe he summer/fall doldrums are about to end for me.

Best wishes,

dhm