The CME Lean Hog Index component on the kill for -

2/15/19 kill was down -0.25 to 54.64. The JJJs settled premium to the component by +4.88. The cutouts were down -1.45 today. I am getting tired of this "Death-by-a-thousand-cuts". Iam expecting the Purchase Index to be down again in the morning and that will set the stage for at least two more down-days for the component.

The six-day moving average carcass weight firmed to 215.90#. That is +1.47# yr/yr. Packer hogs are heavier than the non-packer hogs by +2.96#. The percentage of packer hogs in the kill mix continues to be at a higher than usual level suggesting the packers are expanding their production capability to significant degree.

If some export demand does not surface from someplace, we may be back in the chase looking for the Hog Cycle low to the CME Lean Hog Index. I had thought the 45.30 posted on 9/3/18 was the trough but now I am not so sure. The Chinese back yard producers may be in a liquidation mode and they my be dumping a lot of pork on the market now and depressing the price. After the panic liquidation will come the shortage and it could last for quite a long time and end up going really, REALLY HIGH. But my fingers are getting tired of HODLing!!

Best wishes,