2/21/17 kill was up +0.37 to 77.82. The weakness in the JJJs today opened the "Gap" to -10.07 at the close with the JJJs being at a discount to the index. In the afternoon reports it appears that packers have begun the process of lowering their bid prices for hogs. They have an ITZ-ten-point move to get the job done. One thing about packer, they know how to hack their bid prices when the product is not moving that well for them. It appears to me that packers still have a fair-sized inventory purchased at these higher prices so it may take the index another day or two to turn down.

The six-day moving average carcass weights were steady today at 212.22#. That is +0.53# year/year. The percentage of packer hogs in the kill-mix has been moving up lately and their hogs are now just 3.43# heavier than the non-packer hogs. Perhaps packers are now going to be liquidating their inventory of heavy hogs if demand is drying up a little.

I was stopped out of the long JJJs and am now mildly short.

I'm late getting this post up. Had a lot of company come by my trading desk today and it got me behind with this post.

Best wishes,

dhm