Lean hogs end mixed as trade gauges trade war impact on pork exports
Karl Plume, Reuters
via Financial Post (Canada) - August 9, 2019
CHICAGO — Chicago Mercantile Exchange (CME) lean hog futures were mixed on Friday in choppy trading as investors weighed rising pork prices against weak cash hog values and rising concerns about pork exports to China.
Spread trading steered some contracts up sharply while others, including actively traded October and December futures, retreated.
“Spreads were driving the game today, and they especially pressed the spreads into the close,” said Top Third Ag Marketing analyst Craig VanDyke.
The hog market has been riled in recent days by worries that China would suspend all purchases of U.S. pork after months of speculation that sales to the world’s top hog and pork market would soar this year.
China is battling a severe outbreak of African swine fever that has decimated the country’s hog herd and sent domestic pork prices soaring.
The move by Beijing to suspend U.S. purchases came after U.S. President Donald Trump labeled the country a currency manipulator and vowed to slap more tariffs on Chinese goods next month if there is no progress toward a trade deal.
“It seems that the trade is kind of exhausted after the big moves that we had in the hog market and the monster headlines that we had,” VanDyke said...
... U.S. pork prices remain strong, with the latest carcass cutout value at a two-year high of $90.44 per cwt. Traders, however, said sales volumes have been lower than expected...