9-25-14 was up 0.47 to 107.877. That puts the VVVs discounted to the CME Index component by 2.43. Obviously traders think that packers are going to be easing up on their bids.

They may or may not be right.

The six-day moving average carcass weights were up at 213.05#. That is +7.58# yr/yr. On 7/30/14 it was +10.79# yr/yr. It looks to me like producers may be running hogs to market at a fairly aggressive clip and hogs are likely finishing quickly during this period of good growing weather and freshly picked corn.

The kill rate being down 2.69% this week compared to the nearly 6% suggest by the last H&P report seems to validate this idea that producers are shipping hogs at a rapid clip.

If hogs are being pulled forward a bit and packers are bidding higher, packers may not have the luxury of dropping their bids in front of the VVVs going to cash settlement in 12-days.

Best wishes,

dhm