12/15/14 was down -$0.40 and the model projects that the CME Lean Hog Index component on the 12/15/14 kill will drop between -0.25 and -0.55. The hog market now seem to be on a definite downward trend. The Purchase Index has been down for five days and it looks like today will be the 4th down day for the CME Index component.

Packers were able to make a solid purchase of 118.9% of the moving average daily purchases with somewhat lower bids. This tells me that producers are motivated sellers. With the six-day moving average carcass weight being firm yesterday, producers probably have ample numbers of market ready hogs to meet packers' needs.

Historically there is a mild tendency for the CME Index to bounce a little as we get closer to the holidays. That may or may not happen this year.

I carried three short Feb cattle/hog spreads over night. I took profits on one at 77.50 and am enjoying the down-hill ride on the other two. Yesterday I scaled in and out of the Feb cattle/hog spread so many times that my head was spinning when the day ended. It has taken me longer than usual to reconcile my records to the equity runs this morning.

ITZ really did me a huge favor when he alerted me to the disharmony going on in the cattle/hog market. A big "Thank-you", ITZ.

Best wishes,

dhm