Uncertainty over coronavirus puts selling pressure on US hog markets

The global hog markets got another dose of bearish news late this week, as the coronavirus on Thursday was reported to be escalating in its rate of new illnesses in China.
calendar icon 17 February 2020
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Latest US Department of Agriculture (USDA) reports

Weekly export sale report for the week ending 6 February.

US PORK: Net sales of 28,600 MT for 2020 were primarily for Mexico (6,800 MT), Japan (4,400 MT), China (3,700 MT), South Korea (3,600 MT), and Canada (3,100 MT). Exports of 42,900 MT were primarily to Mexico (13,100 MT), China (13,000 MT), Japan (6,000 MT), South Korea (3,600 MT), and Canada (2,200 MT).

Monthly support and demand report (WASDE)

This week’s USDA monthly supply and demand report saw the agency raise its US pork export forecast for 2020 by 275 million pounds, but it made no reference to increased demand from China. USDA said it expects “robust global demand” for US pork. Still, US hog futures traders remain focused in part on the continued high hog slaughter levels so far this year. US hog kills are up 6.3 percent so far this year. However, slaughter rates should start to recede soon.

Prices still in accelerating downtrend and bears have solid technical advantage.
Prices still in accelerating downtrend and bears have solid technical advantage.

Now, no early clues that market bottom close at hand. © Jim Wyckoff

Prices move into lower boundaries of the trading range of the past few years, suggesting the downside is limited at present levels
Prices move into lower boundaries of the trading range of the past few years, suggesting the downside is limited at present levels

© Jim Wyckoff

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