4/18/18 was up +1.08 and the model projects that the component on yesterday's kill will jump between +0.55 and +0.85. The spring advance in the price of hogs is now here. Traders are expecting this and have priced the KKKs at a premium of 14.21 over the component. The component will need to gain an average of +0.785 per day for the next 18 days to close that "Gap". To be sure the trend is now up and over the last four days since the trend started up it has gained an average of+0.63 per day. If the KKKs were pushed down too low, and it appears that may have been the case, the front end of the recovery may progress faster than the back end. Since cutouts are not moving up much, I have decided to hold a couple of short KKKs.

Packers purchased 85.6% of the moving average daily purchases with their higher bids yesterday. The rounded-up 100.7% of the Index hogs.

Best wishes,

dhm