5/25/17 was up +0.16 and the model projects that the component on yesterday's kill will rise between +0.20 and +0.50. The up trend continues to defy the historical tendency of taking a mild dive after the Memorial Day demand surge passes. Historically there will be another demand surge as we approach Independence Day. The MMMs are now trading premium to the component by 4.74. The model projects that the component will need to rise by 0.36 per day to close that "Gap".

Primal cuts continue to be firm.

The Kill this week is coming in below expectations.

Carcass weights are declining suggesting that hogs have been pulled forward putting questions in my mind about the accuracy of the last H&P report.

Packers have liquidated their inventory of heavy hogs and their hogs are now lighter weight than the non-packer hogs.

I had been thinking that the MMMs would tack on a point or two and now they have done it. Now I'm thinking there may be another point or more to go so I am staying with the long MMMs. This morning I sold two June 82 calls. That will give me a little cushion if hogs now retreat or lock in profits if they go on up.

Best wishes,

dhm