MURICO.com Forum

The CME component on the kill for - - -

12.19.14 was down -1.16 to 82.04. That puts the index premium to the GGGs by 1.44. It appears that packers are going to take enough off the Index to close the gap and perhaps push the GGGs a little lower.

The six-day moving average carcass weight firmed mildly to 215.84#. That is +2.89# year over year. There may be a mild up trend in the carcass weight. Both packer and non-packer hogs were heavier. If this turns into an extended up trend, it may indicate that producers are getting a bit behind in their shipments.

The percentage of the kill that was packer hogs is moving up. If packers did initially experience greater losses from the PED virus, it appears that they have now solved that problem and are shipping firm numbers. I suppose it is possible that packers began expanding their herd several months ago and now that expansion is beginning to come to market. The percentage of the kill on Friday that was packer hogs moved up to 36.21%. That the highest percentage we have seen for a long, long time.

The Feb cattle/hog spread has opened to 80.025. I'm working to sell at 80.575. It looks like I will have to wait until tomorrow or later to get that order filled.

With the H&P report coming out tomorrow, I'm wanting to reduce the number of K/M spreads I have bought. If there has been a bunch of expansion, the KKKs could feel it more than the MMMs. I was able to sell two today but will try to sell more tomorrow.

Best wishes,

dhm