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ASF Creates Opportunity on the Futures Market for 2019
Tyler Fulton - HAMS Marketing Services

Farmscape for November 28, 2018

[email protected] Marketing Services reports uncertainty over the spread of African Swine Fever is creating opportunity to lock in profits for 2019.
Uncertainty over ASF in China is having a positive impact on the futures market.
Tyler Fulton, the Director of Risk Management with [email protected] Marketing Services, says for 2019 the futures market is sitting at close to the highest levels we've seen from April all the way through to the last offered period.

Clip-Tyler [email protected] Marketing Services:
The lean hog futures in the summer months and even the fall months of next year has factored in a risk premium reflecting the possibility that China will be a greater pork importer than they currently are today.
There's really not good information coming from China.
We get a little bit every week such as a wild boar being found to be positive with the disease indicating that it's not going to be well controlled.
There's evidence that there were cases found in and around the city of Beijing which until now wasn't really an issue and so the disease continues to spread but it's still a very big question as to what degree the North American market will be able to take advantage of that reduction in Chinese production just simply because of the tariffs that are placed on it and the degree to which the Chinese will actually import product to replace its lost domestic production.

Fulton suggests the first half of 2019 offers a really good start for producers to secure some of their prices on production.
He says, at roughly 165 dollars per pig average for the first six months, given current feed costs, that would secure producers a profit so pricing possibly 20 to 25 percent of production is a really good start.
For Farmscape.Ca, I'm Bruce Cochrane.

       *Farmscape is a presentation of Sask Pork and Manitoba Pork

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