12/20/17 was up +$0.24 and the model projects that the component on yesterday's kill will change in the range of +0.05 to -0.25. The down trend in hog prices may have ended and we may be seeing the gradual rise that we usually see in the spring. Most likely it will be a bumpy rise but we may have seen the seasonal low or at least we are getting very close to it. The GGGs are now trading premium to the component by +6.10. Traders seem to have come to the feeling that the low is in and the spring rise is either close at hand or has now begun.

I'm wanting to see the 201 report this morning to see if carcass weights are continuing lower. If they are, we may be in for a surprise when we see the inventory of 180#and heavier category of market hogs in the report tomorrow. Projections are that it will be up 102.4%. The kill this fall has not been quite as high as projected from the last H&P report .

I'm still long the GGGs as well as a boat load of calendar spread strung out between now and the V/Z spread. Have orders working to buy more GGGs if they dip a little.

Best wishes,

dhm