7/11/18 was once again down this time by -0.30 and the model projects that the component on yesterday's kill will decline between -0.20 and -0.50. The NNNs settled discount to the component by -1.68. With cutouts continuing to erode away and packers lowering their bids a little day-by-day, it seems to me there is a good chance that the "Gap" will be mostly closed by the Index falling, maybe not enough to totally close the "Gap" but very close to it. Yesterday I took one bravery pill and got short one of the NNNs.

Yesterday packers purchased 95.8% of the moving average daily purchases of hogs and 96.6% of the Index hogs. Hogs seem to be being shipped as fast as they are finishing with the packers being fairly aggressive in getting current in their shipments. A significant portion of our pork is exported and this trade war is going to have a negative impact on the exports. "The Market" is saying loud and clear, "This will trigger the liquidation phase of this Hog Cycle and it may be a long phase lasting through July of 2019 and maybe beyond."

Best wishes,

dhm