10/23/17 was stronger than projected being up +1.23 to 66.83. That has opened the "Gap" to -2.78 with the ZZZs at a discount to the component. Cold storage stocks came in strong.

The 6-day moving average carcass weight eased to 210.33#. That's -0.57# year over year. Index hogs were also lighter at 210.33#. Packer hogs are coming in +1.15# over non-packer hogs.

It is one thing to have numbers and quite something else to decipher the numbers and figure out what they mean relative to price movement. Here are some of my thoughts:

1. Carcass weight should be getting heavier, but they are not. With the weights running lower than last year, my thoughts are that producers are very current in their shipments and possibly have pulled hogs forward some.

2. The fact that packer hogs are heavier seems to fit with packers bidding higher which means they want more product so to get it, they are opting to finish their hogs a bid heavier.

3. The high freezer stocks may imply that product is being processed for export.

4. When I imput the noon numbers into the model it projected that the component on today's kill will move up again something like +0.70 to +1.00. Packers' appetite for hogs is still unsatisfied and they are handing out more money again today.

On the dip this morning I added to my long ZZZs and scalped out much too soon. I still have the long ZZZs from yesterday working and my margin is recovering.

Best wishes,

dhm