Farmscape for January 21, 2020

The Director of Risk Management with HAMS Marketing Services is hopeful Chinese demand for U.S. pork will lead to higher hog prices in 2020.
Despite record U.S. slaughter hog numbers prices have been holding steady since the start of 2020.
Tyler Fulton, the Director of Risk Management with HAMS Marketing Services, notes retail pork values in North America have been steady to strong over the past four to five years so most people are looking to the export market for further price improvement.

Clip-Tyler Fulton-HAMS Marketing Services:
There is an expectation that we'll see increased movements of pork to China, especially after the new signing of the U.S.-China trade deal.
I'm still somewhat skeptical as to what that impact will be but there's generally widely held views that the U.S., for example, could increase their shipments to China to close to a million metric tons of pork in 2020, which would represent a big improvement and likely see some pretty significant price increases as a result of that.
That's really the million dollar question, at what price level in China do people start pulling back, do companies start pulling back from purchasing because the prices have gotten so high?
Part of the problem is that those punitive tariffs that China applied on the U.S., there's still no time line as to when those will disappear.

Fulton suggests the government owned marketers in China have an advantage in that they can possibly get rebates of those tariffs while private companies will be disadvantaged.
He says there's a lot of moving parts but there is reason for optimism that we could see some big improvements in export volumes and consequently improvements in prices.
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Bruce Cochrane.

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