Hog markets again sold off sharply with the June contract going limit down and the April contract settling $4.30 lower at 79.450. Hog supplies are proving a bit larger than year-ago levels, the opposite of what was implied from the USDA expected, falling 2% below last year. On the other hand, this morning’s weekly export sales report indicated last week’s sales totaled 35,600 metric tons, which was up 62% from the week prior and down just 5% from the four-week average. While, the ongoing outbreak of African Swine Fever in northern China has substantially improved the export outlook for the coming weeks and months. The biggest problem for the hog and pork industry is having retailers maintaining retail pork prices above year-ago levels despite significant year-to-year reductions in cash hog and wholesale pork prices. With this current situation, I believe that is the catalyst causing consumer demand to be put under pressure but will very likely do little to slow the usual spring demand surge as grilling season gets underway in early April.
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Peter McGinn
Account Executive
Walsh Trading, Inc.
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