Farmscape for April 3, 2019
The Director of Risk Management with HAMS Marketing Services attributes the highest level of hog market volatility in two decades to speculation over African Swine Fever.
African Swine Fever continues to be the dominant factor influencing hog markets.
Tyler Fulton, the Director of Risk Management with HAMS Marketing Services, says we're seeing the highest volatility in hog markets in 20 years, stemming from speculation on how African Swine Fever is impacting the Chinese herd and whether the Chinese will be active in replacing those losses.
Clip-Tyler Fulton-HAMS Marketing Services:
Given that the U.S. economy is still performing reasonably well I think pork demand continues to perform reasonably well.
The real issue that has promoted a huge amount of volatility over the last three weeks or so is the issue of U.S. pork exports and most specifically the potential that there may be to have a great deal of volume shipped to China in response to the African Swine Fever.
That issue by itself has effectively trumped every other issue out there.
We are seeing weaker pork exports to Korea than we were or to Japan than we were and for that matter to Mexico than we were so the policies and the time lines as to when we might get a resolution are a significant issue in the market.
If we can see light at the end of the tunnel or if we can see a resolution to the Chinese U.S. trade dispute then it brings us one step closer to actually being able to move significant volumes of pork to China in response to the domestic shortage that they have there.
Fulton says there's still a large question as to whether the Chinese purchasers are going to be looking to the U.S. and, as it sits right now with the 65 percent tariff in place, the U.S. market is probably not the first place they're looking.
For Farmscape.Ca, I'm Bruce Cochrane.
*Farmscape is a presentation of Wonderworks Canada Inc