3/29/17 was down -0.50 and the model projects that the component on yestererday's kill will drop between -0.30 and -0.60. The down trend continues and looking at the weakness in the cutouts yesterday, it is likely to continue.

With their lower bids, packers were able to purchase 87.7% of the moving average daily purchases. That is a bit on the low side but within the range normally seen.

Yesterday I did not get the component change posted. The component on the 3/28/17 kill was down -0.32 to 69.24. Yesterday the JJJs settled discount to the component by 3.94.

The model is projecting that the cash settlejment index for the JJJs will be 65.23 with a range of 64.73 to 65.73. The major assumption is that hogs are now in a down trend that will continue until the JJJs go to cash settlement and the trend will progress at about the same rate it has far the last seven day, ie -.321/day.

The 6-day moving average carcass weight was steady at 212.78#. That is -0.67# year/year. I think this means producers are quite current in their shipments. Packers may be in the process of liquidating some of their heavy hogs but the are still shipping hogs +3.26# heavier than non-packer hogs.

Today I am willing to trust the model and be short the JJJs above 66.25.

Best wishes,

dhm