Chicago | Reuters — U.S. pork exports in November surged to a record high for any month, according to new government data, driven by a fatal pig disease stoking a meat shortage in China.
The shipments fueled expectations for more big sales to China, although U.S. hog futures slumped on Wednesday.
China, the world’s largest pork consumer, needs to increase imports after its hog herd shrunk by about half because of an outbreak of African swine fever. The losses have pushed Chinese pork prices to record highs and roiled global meat markets. China has also increased imports from Europe and Brazil.
“They just have a terrific need,” said Bob Brown, an independent U.S. livestock market analyst. “They’re needing to take it when they can find it.”
Traders will review weekly U.S. export sales data on Friday, one day later than usual because of a winter storm in Washington.
In November, total pork exports reached 259,814 tonnes, up 26 per cent from a year earlier and 11 per cent above the previous high set in July 2019, according to U.S. Department of Agriculture data. Sales to China soared 589 per cent from a year ago to 78,776 tonnes, about 35 per cent of which were frozen carcasses. For January through November, exports to China jumped 134 per cent to 472,811 tonnes, the data show.
“The surge in pork shipments to China will capture most of the headlines this month,” said Dan Halstrom, president of the industry group U.S. Meat Export Federation.
China maintains retaliatory tariffs on imports of U.S. pork, imposed in the U.S.-China trade war, giving an advantage to suppliers in Europe and South America. Still, analysts expect U.S. exports to rise further in 2020 because of China’s shortfall from African swine fever.
U.S. President Donald Trump has said a so-called Phase One trade deal with Beijing would be signed on Jan. 15. It includes a commitment by China to buy more U.S. agricultural products, although details have not been announced.
“Their prices are high enough that they could pay the tariff and still make money,” said Steve Meyer, economist for U.S. commodity firm Kerns and Associates.
Most actively traded February lean hog futures ended down 0.2 cent at 69.025 cents/lb. at the Chicago Mercantile Exchange (all figures US$).
In the beef market, February live cattle futures slipped 0.175 cent, to 126.35 cents/lb. March feeder cattle futures advanced 1.4 cents to 146.525 cents/lb.
— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.