12/29/14 was only down -0.08 to 78.51. Packers were able to run through some more expensive hogs that they had bought someplace and that gave us a firmer component than the model was projecting.

The six-day moving average carcass weight fell to 215.65#. That is +2.11# yr/yr. With the holiday lighter kill, I was expecting hogs to tack on a bit of extra weight and not get lighter. This may indicate that producers are not particularly flush with market ready hogs right now. The last H&P report pegged the 180# and over category down 2.0% and that is consistent with the kill we have seen since 12/1/14. I think there is a fairly good chance that the kill will remain weak long enough to be supportive of the Index until the GGGs go to cash settlement. Based on this my bias is to be long the GGGs. I watching to see if traders will beat them down below 80 so I can get on at that level.

I have scalped a few GGGs this morning from the long side but they are quick in-and-out trades. Below 80 and I will stick with them a while.

Best wishes,

dhm