8/22/17 was down -0.87 to 80.07. The VVVs are now trading discount to the component by -17.17. That's a lot but the component has dropped an average of 64.2 cents per day for the past seven days. If that rate continues, we end up with a cash settlement index of 57.77. To close the current "Gap" the component needs to average a drop of -0.48 per day. Either way that will be a lot of squeeze on the producers' profits.

The six-day moving average carcass weight firmed to 207.56#. That's +0.55# yr/yr. Index hogs were a bit lighter at 207.58#. Both packer and non-packer hogs were 0.40# heavier. The packer kill yesterday was quite large at 34.68% of the kill. It is not usually quite that high. Producers may be getting behind in their shipments.

I'm now a tiny bit short the VVVs but the "Gap" makes me very cautious.

Today a piled another long K/M spread on my boat. It is no longer riding high in the water. There was a lot of action in the calendar spreads yesterday and I piled a bunch on. Now I'm ready to take some off but today that didn't happen.

Best wishes,

dhm