The CME Lean Hog Index component on the kill for -

130/18 was down 0.29 to 73.81. The GGGs are now trading discount to the component by -0.66. The surge in the GGGs today has done a lot of "Gap" closing. I'm still long the GGGs but they are covering some short calls. Harvesting option premium is going well this month.

The six-day moving average carcass weight was unchanged at 214.27#. That is +1.44#. It looks to me like packers are wanting bigger hogs but since packer hogs are +1.23# heavier than the non-packer hogs, they may also be wanting more pork. It might be that they have some deferred sales hanging out there and they need the pork to meet their sales commitment. One thing we do now is that the amount of pork reported on the 605 report represents less than 10% of the pork packers produce so our knowledge of demand is very small compared to what the packers know.

Today I felt compelled to dump a few short G/J spreads off my boat and into the pond for ITZ's fish to eat. They were getting too stale to tote around any longer and when they begin to stink, it's time to clear the decks. I thought about holding them until the GGGs expire and become long the JJJs but the tendency for the JJJs to sell-off after the GGGs expire is so strong that I decided to get the bad news behind me.

Best wishes,