7/5/19 was down -1.60 to 71.47. The NNNs settled discount to the component by -1.35. That is not much of a"Gap" considering the fact that packers dropped the component on Friday's kill by -1.60. The model calculates that packers' margins yesterday was $0.87 per hog. That does not go very far toward paying salaries, utilities and everything else it takes to operate a packing plant. Packers have little choice but to keep cutting their bid prices unless of course the Chinese begin buying pork by the boat loads. At this point there is little to suggest this will happen between now and when the NNNs go to cash settlement.

The six-day moving average carcass weight firmed to 211.53#. That is +3.52# yr/yr. Index were down a bit at 210.78#. Packer hogs were lighter than non-packer hogs by -0.94#. It appears that packers ran a bunch of their hogs to market in front of the non-packers and became very current in their shipments before prices really began to crumble.

I am short a bunch of NNNs but it looks like I should have piled on a bunch more to off-set the way the summer 2020 hogs are going to pot.

Best wishes,

Doc