9/23/14 was UP 0.42 to 106.74. That puts the VVVs premium to the CME Index component by a paltry 0.63. There will be a strong tendency for them to move in lock-step this close to cash settlement.

The 6-day moving average carcass weight was exactly unchanged with packer hogs being a bit lighter and non-packer hogs being a bit heavier. It continues to appear that packers are being a bit more aggressive in moving hogs to market than the non-packers. It is unclear whether this is because packers are needing to bring more of their hogs in because they cannot find hogs or whether they are wanting to kill their hogs now thinking they can buy hogs cheaper down the road a ways.

What ever the explanation, the percentage of packer hogs being killed is running mildly higher they usual. The 5-day moving average percent of packer hogs is 33.0%. It is generally down around 31.5%.

The short Z/G spreads have worked well for me and I have some left. I have covered some and will try to get the rest covered in front of the H&P report. The report could show some expansion that will be coming to market before the GGGs go to cash settlement.

Best wishes,

dhm