1-26-15 was down -$1.16. The model projects that the CME Lean Hog Index component for the 1-26-15 kill will be down between -0.60 and -0.90.

Packers were able to get an above average purchase at 115.1% of the moving average daily purchases with their lower bids. It continues to appear that producers are quite willing sellers and they seem to have adequate numbers of hogs. At least the continued heavy carcass weights, firm scheduled numbers as well as a higher kill rate than suggested by the last H&P report would seem to suggest an ample supply of market ready hogs.

Cut outs were not very strong yesterday and so I scratch my head and wonder, "Why are the GGGs up more than a point this morning?"

Maybe traders have decided that the 2.08 discount to the component last night was just too much. As much as a point of the discount could evaporate when the 201 report comes out this morning.

I guess this uncertainty is the reason I don't have any of them. I just don't have a good feel of what the GGGs are going to do.

Best wishes,

dhm