The final Purchase Index for - - -

12/8/14 was UP +$0.04 . The Purchase Index has been up a little for two-days now and the component has hardly budged. Packers may be accumulating a few more expensive hogs that will be delivered one of these days and firm the component a little. The model projects that the chanage in the component on the 12/8/14 kill will be in the range of +0.05 to +0.35.

Even though packers kept their bids steady to firm, the number of hogs purchased yesterday was a bit weak at 89.0% of the moving average daily purchases. This may set the stage for packers to keep their bids up today.

The ZZZs are trading at a discount of 1.40 to the component. With the chances that the component may be firm today and the ZZZs going to cash settlement Friday, being short the ZZZs is not my idea of the right way to approach this market. The GGGs better rally as much as the ZZZs or else the short Z/G spreads are going to make a withdrawal of some of the profits I have banked.

Best wishes,