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Demand pegging not honoring demand priority rule

Summary:

I have set up demand priority rule and associate it to my supply plan.

However, as it's in the screenshot below, I have sufficient onhand of 32366 pieces which can easily cover my sales order with suggested due date of 1/28, and then partial of 1/29.

Why is planning splitting one sales order from 1/28 instead of 1/29? Shouldn't it try to fulfill the soonest sales order first and not cause any late order? From the calculated demand priority it seems my order 5696 is having the highest priority of 1.

Why is planning still trying to split sales order 5696 and peg it to a later plan order and cause late demand?

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