MURICO.com Forum

The final Purchase Index for - - -

5/24/18 was unchanged and the model projects that the component will be up between +0.15 and +0.45. Packers still have an inventory of higher priced hogs that will be supportive of the index today even though they were not bidding higher yesterday. The MMMs are now trading premium to the component by 5.46. The model calculates that the component will need to tack on an average of 0.37 per day from now until cash settlement to close that "Gap". It has gained an average of 0.39 per day for the past five days. Maybe the MMMs are priced about right now. That have come down by 2.85 since they settled at 77.325 on 5/10/18.

Yesterday packers purchased 87.4% of the moving average daily purchases of total hogs and 93.4% on the index hogs. Packers are not needing many hogs in front of the long holiday weekend.

I'm still short the MMMs.

Best wishes,

dhm