2/8/17 WAS UP +$0.79 AND THE model projects that the component on yesterday' kill will jump between +0.35 and +0.65. Packers continue to want hogs and they are are willing to keep bidding higher to get them. That's the way it works when their margins are favorable. Producers were quite willing sellers and packers were able to purchase 113.2% of the moving average daily purchases. They seem to be trying to make up for some of the low-purchase days last week.

The GGGs are trading premium to the component by +1.50. According to the mode, good portion of that will close when we get the 11:00 report. With only three more trading days before we go to cash settlement, there may not be a lot of room for the GGGs to climb much higher. There is a good chance that I will end up going to cash settlement with some of the longs on my trading boat.

Best wishes,

dhm