12/6/17 was up +0.42 to 65.51. The ZZZs are now trading discount to the component by -1.89. That seems a little wide with the holiday rush to the meat cases coming on.

It is true that carcass weights are a little on the heavy side however this is that time of the year when pork demand becomes a bit stronger as we move into the holiday season. The 6-day moving average carcass weight was a bit firm at 215.24#. That is +2.94# yr/yr. Index hogs were a little soft at 214.98#.

Both the CME Lean Hog Index and the Purchase Index seem to be in a mild up-trend now. From the noon reports the model projects that the component on today's kill will be up again. Historically there is a mild tendency for the index to show a little strength in front of the holidays. With the ZZZs at discount to the component, it just might be that the "Gap" will be close by the ZZZs moving up.

The likelihood was sufficiently strong to cause me to add two more long ZZZs with the idea of taking them to cash settlement.

Best wishes,

dhm