10/11/17 was only up 0.56 to 59.39 so we have a "Gap" of 1.56 with the VVVs premium to the component. The model projects that it will take a jump of 1.07 for the next two days to close that "Gap". We have only had one-day with that kind of a movement lately. My guess is that the VVVs may give up a little at cash settlement. So I am looking for a bounce to get short a little. Maybe I just saw it and didn't act.
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The six-day moving average carcass weight was nearly steady at 210.56#. That is -0.17# yr/yr. This may be indicating that producers are very current in their shipments. The high kill rate this week is most likely pulling hogs out of producers' barns as fast as they are finishing. The percentage of packer hogs in the kill mix continues to be quite high. I don't know if that means they are now producing a larger percentage of the market hogs or whether they are pulling their hogs forward. Since their hogs are a bit heavier, maybe they are now owning a larger percentage of the production.

We just had a bounce and I just got short some VVVs to take to cash settlement. I'm going to pretend I'm from South Texas and sell some more if they bounce again higher.

Best wishes,

dhm