News

China news is driving the wild ride in the hog markets

Cash and futures hog prices have sky rocketed recently. 

And livestock economist Scott Brown says there’s been one obvious driving force.  “We get these $20 runs in futures markets in two weeks,” he says.  “We certainly are seeing an increase in what we think are the affects of ASF in China.”

He tells Brownfield the US pork industry has been captivated by what has been going on with China.  “When you realize half of the world’s pork is produced and consumed in China, it doesn’t take a big change to maybe justify a very large change in what happens in the United States.”

Brown says pork producers need to figure out the risk management plan that works best for their operation – because there isn’t a one-size-fits-all solution.  “We certainly don’t have to sell every pound of pork you think you’re going to produce,” he says.  “But, it might be an opportunity to let the first third of your production go and let someone else deal with that risk.  If you’re an operation that can handle a lot of risk – maybe you’re going to ride on this for a while.”

He says wide swings in the market are inevitable and producers should be prepared to see prices skyrocket one week and then correct themselves the next.