6/17/19 was up +0.36 and the model projects the component on yesterday's kill will change in the range if +0.15 to +0.15. The NNNs settled premium to the component by by 3.85. It was the Eastern Corn Belt where the packers were bidding the strongest. I think this is Smithfield hog-shed area and I am watching it thinking it might give an early clue relative to demand for hogs to go into the export market. I read on an Asian Internet web site over the weekend a projection that the price of pork in China would spike by 70%. If U.S. hog prices could capture half of that price surge, it would put the summer 2020 futures above 100. With the QQQ20s at 88 that would be a decent gain so I will continue HODLing the summer 2020 futures but some days it gets a bit tense.

With their higher bids packers purchased 83.5% of the moving average daily purchases of total hogs and 92.2% on the index hogs. I think that is a solid Monday purchase following the monster purchase we saw on Friday.

The kill this week is starting out to be huge. Packers were able to move the pork without the cutouts dipping very much. That is consistent with the Independence Day holiday demand surge. I will be watching the data to see if we get a "Usual" summer decline in the kill rate. If we do, it will set the stage for the seasonality high to be posted in August. At this point, though, "The Market" is saying that the seasonality high was posted on 5/17/19 when the CME Lean Hog Index printed 84.59. Please be mindful that it is not yet written in stone that the seasonality high is that 84.59 that we have already seen.

Best wishes,

Doc