12/20/17 was down -0.50 to 61.75. That was a lot weaker than the model projected. The GGGs are now trading premium to the component by +7.07.

The six-day moving average carcass weight showed a touch of weakness at 216.78#. That is +2.92# year/year. Index hogs were steady at 213.78#. There was a touch of weakness in both the packer and non-packer hogs with packer hogs being +1.18# heavier than non-packer hogs. It continues to appear that producers have become quite current in their shipments and the trend toward heavier carcass weights is continuing.

I am continuing to approach the hog market with the bias that the seasonal low has either been posted or is neigh at hand. So I am long the GGGs from yesterday's early morning dip and added another one this morning. The "Gap" is quite wide, to be sure, but if the supply of hogs fails to meet expectations, the firm demand that has surfaced this year could easily push the index up enough to close that "Gap".

Best wishes,

dhm