Farmscape for February 25, 2020

The Director of Risk Management with HAMS Marketing Services says continued record U.S. slaughter hog production combined with growing trade uncertainty resulting from Coronavirus is pressuring live hog prices.
Typically slaughter hog numbers would tend to trail off at this time of year but they haven’t as much as they should.
Tyler Fulton, the Director of Risk Management with HAMS Marketing Services, says numbers are easily running at their highest level ever for this time of year as U.S. producers continue to ramp production and that has kept a cap on live hog prices more than anyone expected.

Clip-Tyler Fulton-HAMS Marketing Services:
What we've seen starting about two weeks ago and then again early this week is severe impacts from the development of the Coronavirus, which has no direct affect on hog production anywhere, but it does threaten export demand.
I think there's significant concerns about the ability to move product into places like China where the demand is obviously very high given the losses related to African Swine Fever but there's a lot of concern about the grand economic impacts that Coronavirus may have globally.
That uncertainty has really put pressure on futures markets early this week and I think that uncertainty associated to that demand, it's really up for question.
We know that there's a massive hole that ideally would be filled partially at least by global pork production moving into China but, with the constraints related to the Coronavirus, it's really difficult to access that so there's a lot of concern about the ability to logistically move that pork into the country and the impact the virus will have on overall demand for everything.

Fulton says we know there's a direct correlation between economic growth and demand for pork products and so that's a growing concern in futures markets.
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Bruce Cochrane.

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