US hog futures surge as meat plants warn of pork shortages
US lean hog futures rose their daily limit on Monday (27 April) on fears of tightening domestic pork supplies as the coronavirus pandemic forces slowdowns at slaughterhouses, analysts said.
28 April 2020
2 minute read
By: June lean hog futures on the Chicago Mercantile Exchange settled up the daily maximum of 3.750 cents at 55.275 cents per pound, the contract's highest since 8 April. Daily limits will widen to 5.500 cents for Tuesday's session.
The world's biggest meat companies - including Smithfield Foods Inc, Cargill Inc, JBS USA and Tyson Foods Inc - have halted operations at about 20 slaughterhouses and processing plants in North America since April as workers fall ill.
With meat-packing plants unable to receive livestock, some hog and poultry producers are being forced to cull their herds and flocks.
"We are taking hogs out of supply that are not going to go into the meat supply," said Doug Houghton, analyst with Brock Associates.
The US wholesale pork cutout rose by $3.76 on Monday, according to the US Department of Agriculture, reflecting tighter supplies. The US hog slaughter totalled 1.986 million head in the week ended 25 April, the USDA said, down from a weekly total of nearly 2.8 million head in late March.
