The final Purchase Index for - - -

1/10/19 was up +0.32 and the model projects that the component on yesterday's kill will edge up between +0.30 and +0.60.

With their higher bids packer purchased 80.1% of the moving average daily purchases of total hogs and 84.8% on the index hogs. The GGGs are now trading premium to the component by +6.25 and the model calculates that an average daily gain in the component of +0.24 is needed to close the "Gap". The component has been up an average of +0.61 over the past six-days.

In looking at today's sell-off across the board in hogs, it is possible that one of two things is happening:

l. There has been some fundamental bearish news surface in the hog market. This may be China controlling their ASF problem, it may be a geopolitical problem, it may be problems with domestic demand or several other potential problems or -

2. Some Big Dog traders are beating the price of hogs down to panic producers to sell futures to hedge their production then they will run the price back up to strip the producers of their margin. My bias is that this is a technical/emotional dip so I have taken this dip as an opportunity to reload my boat with the GGGs and some summer futures from shich I have taken profits.

If there is fundamental bearish news surfacing, I may get my ears pinned back.

Best wishes,