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The CME component on the kill for - - -

9/29 was up 0.52 to 109.24. The VVVs are now discounted to the component by 0.81. It appears that up-trend in the index is going to be strong enough to push the VVVs higher. It seems to me that the packer sold hogs are often a leading indicator of the direction the index is headed. Currently packer sold hogs are firm at 111.86. The index may not get that high by the time the VVVs go to cash settlement, but I'm suspecting they will head somewhat in that direction.

The six-day moving average carcass weight dipped to 212.908. That is +7.13# yr/yr. There is a gradual reduction in the yr/yr increase. On 7/30/14 it was 10.79#. This may indicate that producers are moving their shipments forward as packers bid up and packers may be bidding up in order to bring in the hogs. This may be a bullish indicator for the VVVs.

Packer hog carcasses dropped more in weight (-0.94#) than the non-packer hogs (-0.23#). Not only did the packer hogs drop in weight, but the percentage of the kill for packer hogs dropped to 27.66%. That's the lowest percentage of the kill that was packer hogs since 7/25/14 when it dipped to 27.53%.

I have had this "Gut" feeling that packers may have suffered greater PED v losses than the non-packers. Maybe this is showing up now.

I'm cautiously long the VVVs.

Best wishes,

dhm

Messages In This Thread

The CME component on the kill for - - -
Re: DH, these Dec hogs can't decide
Well, ITZ, my crystal ball is not much - - -