4/26/18 was up 0.49 to 61.99. The KKKs settled premium to the component by 4.11. The model calculates that the component will need to jump by 0.36 per day to close that "Gap". The average gain for the past eight days has been 0.93/day. With cutouts cooling a little on Friday, packers may not be in the mood to continue to throw as much money at hogs as they have the past week or so.

Since the expiration of the JJJs on 4/13/18, the KKKs have skidded by -2.375 and the component has tacked on 8.34. That represents a lot of "Gap" closing in short order. There is still some "Gap" to close and there is a good chance that we will continue to see a little weakness in the KKKs and strength in the components.

The six-day moving average carcass weight firmed to 215.10#. That is +1.49# yr/yr. Packer hogs were +3.48# heavier than the non-packer hogs. Index hogs were lighter at 214.23# which tells me that producers of Index hogs are more current in their shipments. This may tend to be a bit supportive of the index but packers may be able to pick up some of the slack with their "Owned" hogs.

Over the past 200-days the percentage of packer hogs in the kill mix has been 32.89%. During the past week it was 33.7%. These numbers suggest that packers are continuing to expand their production capability. Perhaps in other words, "Corporate hog production is pushing out the family farm hog production."

Best wishes,

dhm