1/3/17 was UP +0.30 to 57.78. Packer dished me out a surprise and ran some of their more expensive hogs through their plants yesterday. They may still have a few cheaper hogs that will hold the index down for another day or so. The GGGs are trading premium to the component by +6.50.

The six-day moving average carcass weight came in at 212.90#. That is only -1.41# year/year. Hog either tacked on a lot of weight over the holidays or else producers are getting behind in their shipments. Packer hogs are still running +5.58# heavier than the non-packer hogs. I keep trying to read a bullish twist into the heavier packer hogs. It just seems to me if packers were concerned about selling the product they would be getting current in their shipments. Heavier hogs means more pork to peddle and packers don't seem to be concerned about that.

This is turning out to be one slow day for me. I have pulled off a couple of small, long scalps in the GGGs but that didn't pay the electric bill. I'm starting to suspect that the sell-off yesterday was a technical/emotional/stop running move and we will see the GGGs move back up into the 65 to 66 range. I'm long a couple of GGGs and sold a couple of naked GGG 61 puts. I don't think it is in the "Tea Leaves" that the GGGs will go to cash settlement down in the 61 range.

Best wishes,

dhm