1/31/19 was down -0.91 and the model projects the component on yesterday's kill will retreat between -0.40 and -0.70. The GGGs settled discount to the component by -0.22. I am suspecting the GGGs will be quite closely tied to the component from now until cash settlement.

Packers did not purchase many hogs with their lower bids yesterday - only 70.9% of he moving average daily purchases on total hogs and 72.1% on the index hogs.

Two things caught my eye yesterday and they have me scratching my head - why did packers only kill 261K of hogs yesterday and what caused cutouts to drop by 1.70?

It is bitter cold some places and that may have closed some plants. I was expecting the GGGs to drop significantly today because of the drop in cutouts AND the weak Purchase Index.
But it didn't happen, at least not yet.

Best wishes,

dhm