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The CME Lean Hog Index component on the kill for -

3/4/2020 was up +0.30 to 56.95. The JJJs settled premium to the component by +8.43. The model calculates that packers gross margins are $21.64 / Index hog.

The 6-day moving average carcass weight firmed to 215.67#. That is +0.33# yr/yr. Index hogs were unchanged at 214.33#. Packer hogs were heavier than the non-packer hogs by +3.11#.

The afternoon Purchase Index was up+0.78 and the model projects the component on today's kill will be up between +0.20 and +0.50. It is beginning to look like the spring rally in the CME Lean Hog Index has begun. It will not be a straight "UP" rally but we should eventually get to the "Seasonality High" for this year. The market says the seasonality high will be a bit above 80 and it will happen it be hit sometime in late July or early August. I believe once the corona virus runs it course and China comes to grips with the large number of hogs they have lost to ASF, the index will once again test the 90 level or above.

Best wishes,

Doc