6/16/17 was UP $1.36 and the model projects that the component on Friday's kill will jump between +0.85 and 1.15. With these higher bids packers were able to round up 103.1% of the moving average daily purchases of index hogs. Total hog purchases were 92.5% of the moving average daily purchases. This may indicate that packers are finding hogs in mildly tight supply and to meet their needs/wants, they are bidding higher for the index hogs that are not committed.

Logic tells me that part of this aggressive bidding by the packers is associated with meeting the forth coming holiday demand. Looking at the way carcass weights have fallen, my read on the data is that hogs have been pulled forward some. Hot weather may be slowing the finishing of hogs. If demand holds up well, packers may opt to keep their bids fairly firm following the holiday. That is usually not what happens following the Independence Day holiday. It is not the historicals that drive prices. It is the supply and demand here and now!

The kill last week was +1.25%. That is a lot less than suggested by the last H&P report.

STill long the NNNs.

Best wishes,

dhm