CME update: lean hog futures tumble as surge in coronavirus cases sparks demand worries
US hog futures plummeted on 19 November on worries about demand for pork as soaring COVID-19 infections across the country threatened more restaurant and food service closures and forced more Americans to shelter at home.
20 November 2020
3 minute read
By: Reuters reports that investors also fear a repeat of the livestock processing disruptions seen in the spring as rising COVID-19 cases at meat plants backed up livestock supplies and dragged futures prices to the lowest in a decade or more.
"There's some demand concern coming forward after our spring mess," said Matthew Wiegand, broker with FuturesOne. "To what degree can we hold up the processing pace? As of today, we're not seeing major problems, but it's in the back of everyone's mind."
Disappointing pork export sales accelerated the slide in hog futures, he said.
Pork sales were weaker than expected at 31,210 tonnes, the lowest in a month, according to USDA data.
In addition, lofty feed grain prices, with corn futures hovering near 16-month highs and soybeans at the highest in more than four years, weighed on lean hog futures on Thursday.
Chicago Mercantile Exchange December lean hogs fell 2.100 cents to 63.700 cents per pound while actively traded February ended 2.850 cents lower at 63.050 cents per pound.
