1/27/15 was down -$0.26 and the model projects that the CME Lean Hog Index component will fall between -0.20 and -0.50. The down trend is still in place but it does not seem to be gaining steam. I keep looking for signs that we are close to the bottom and I don't see that either. This is the time of the year when the CME Index begins to climb.

The number of hogs coming to market are great enough to keep the downward trend in hog prices in tact. The kill so far this week is running 4.94% higher than the same week last year. This comes on top of the +4.61% year over year jump last week and the hogs are +2.40# yhr/yr.

The data is pointing to more hogs than the USDA projected on the last H&P report.

The data makes it appears that being short the GGGs and JJJs is appropriate at the point in time but I hate to fight the historical tendency for the Index to rise as we move toward the Memorial Day holiday. I have one G/J spread that isn't doing much.

Best wishes,

dhm