2/13/2020 WAS DOWN -0.34 TO 56.21 and that is 50% of the cash settlement index for the GGGs. The component on the kill for Friday will need to drop by +0.63 to close the "Gap". From the Friday afternoon reports the model projects the component on Friday's kill will drop between -0.30 and -0.60. I went to cash settlement with four short GGGs at an average price of 64.14. That will give me a nice gain but not nearly enough to off-set the damage caused by the long summer futures.

The six-day moving average carcass weight was steady at 216.10#. That is only +0.53# year/year. Index hogs were a bit heavier at 214.21# while packer hogs were heavier than the non-packer hogs by +3.59#.

The kill this week dipped to +3.96% yr/yr from an average of +10.2% over the past three weeks. If we can believe the last H&P Report, there will be more erosion in the kill rate over the next several weeks and it may be more than projected if the high kill rate we have seen lately represents hogs being pulled forward.

Best wishes,

Doc