7/15/19 kill eased -0.17 to 70.53 which was the other 50% of the cash settlement index for the NNN putting the cash settlement index at 70.62 as DuRock posted. Since the NNNs last settled at 70.78 there was a little to be gained going short into cash settlement but the benefit came from getting short early. I began selling the NNNs at 79.45 and made my last sale at 71.05 on 7/15/19. I needed a good July expiration to make up for some of the blunders I have pulled this year.

The si-day moving average carcass weight eased to 210.77#. That is +3.59# yr/yr. Index hogs were also down a little at 210.88#. The packer hogs were +0.50# heavier than the
non-packer hogs.

The kill so far this week is -0.34% below the same period last year. Perhaps we have worked through the large number of hogs the USDA found in the 180# and up category and with hot weather slowing the rate of gains, we may see the kill drift a bit lower. Hogs are still coming to market heavier so the pounds of pork will still be firm.

From the afternoon reports the model projects the Purchase Index will be up +0.23 and the component on Tuesday's kill will change in the range of +0.15 to -0.15. With their firm bids, packers only purchased 77.9% of the moving average daily purchases of total hogs ad 93.0% on the Index hogs. Cutouts made a nice rally tacking on $2.90/cwt. It is looking more and more like the 84.59 posted by the CME Lean Hog Index on 5/17/19 is going to be the seasonality high for this year. It may be a struggle for the Index to gain enough just to close the "Gap" of +8.52 to the QQQs. I think we are still in the chase looking for the next Hog Cycle High. If Trump and Xi come to terms and exports pick up, matching the last Hog Cycle at the 130.00 level is a real possibility!!

Best wishes,

Doc