12/29/14 was down -$0.39 and the model projects that the component on he 12-29-14 kill will drop between -0.40 and -0.70. The down trend in the CME Lean Hog Index remains in tack.

But it will end and generally it is about this time of the year when it ends and begins a gradual climb until it tops out about the middle of May. It doesn't always do that but generally it does.

The GGGs are now trading premium to the Index by +3.11. That "Gap" will open a little when the 201 report comes out unless traders take a little air out of the GGGs which they appear to be trying to do.

It appears, ITZ, that we made a correct decision to step out of the short Feb cattle/hog spread. There is no doubt about it, the supply of market ready cattle are in tight supply. If consumers are finding money in short supply, there may be some shifting to pork and chicken. That could put some downward pressure on beef but it is NOT happening yet.

I'm wanting to get long the Feb hogs down in the 79.80 to 79.90 range. If cattle then get back to their previous high the Feb cattle/hog spread could get to 90 and I will be selling again.

Best wishes,

dhm