8/31/18 was down -0.30 to 45.30. The VVVs are now trading premium to the component by 5.87. Traders are absolutely convinced that the "Trough" to this Hog Cycle will be hit before the VVVs go to cash settlement. The Purchase Index seems to have bottomed-out and headed higher so that just might be the case. There is still plenty of pork and I think it will take exports to carry it off. If we have to rely on domestic consumption to absorb it all, the price will probably need to contract back down. Getting a deal with Mexico is obviously a good sign.

The six-day moving average carcass weight eased to 207.78#. That is -1.26# yr/yr. Packer hogs are -0.96# lighter than non-packer hogs. Packers are still shipping their hogs quite aggressively. Index hogs were a bit lighter today at 207.53#.

Being long the summer futures continues to work for me. I sold a MMM pig on a rally this morning and was able to get it back on a dip. I really not doing a very good job of buying the dips and selling the rallies but the strength of the up trend is making up for a multitude of trading mis-steps. I have caught several of the suckers that ITZ may have thrown back today. I'm easy to please - a little sucker money makes me happy.

Best wishes,

dhm