3/27/17 kill was down -0.38 to 69.57. The JJJs settled discount to the component by -4.47. That is quite a "Gap" with just 13 trading days until we go to cash settlement. The fact remains, though, that the Index is trending down and today was the sixth down day. Packers seemed to be bidding lower today so it appears we will have seven down days when the data comes in for today's kill.

Cutouts took quite a beating today and when packers margins' start to close, packers get cranky and cut their bids even more. So far this week the kill is way-up over the same week last year. So much so that I suspect that last year's kill was unusually low. The fact remains, though, we are seeing high kill numbers.

The 6-day moving average carcass weight eased to 212.79#. That is -0.63# year/year. Producers seem to be quite current in their shipments. Packers are getting more current. Their hogs are now +3.08# heavier than non-packer hogs. Index hogs were steady today at 212.04#.

The model is projecting that the cash settlement index for the JJJs will be 65.23 with a range of 64.73 to 65.73. I took a couple of bravery pills today and sold some April 69 calls when the price spiked a little and scalped a handful of JJJs from the short side.

Now the worry over the H&P report begins. I have quite a boat load of calendar spreads so I have more risk on the table than I would like to have. I might have to check my supply of bravery pills.

Best wishes,

dhm

PS: The 201 report was really late today.