PEDv Concerns Behind Higher Hog Prices
Concerns with possible losses due to Porcine Epidemic Diarrhea Virus - PEDv - seem to be driving hog prices. That's according to Purdue University Extension Economist Chris Hurt - who says lean-hog futures market participants seem to have decided the losses will be very large for slaughter supplies this spring and summer - as April lean-hog futures have risen by $10.68 in the past two weeks. June futures have risen by $6.10 to record highs. According to Hurt - the number of animals coming to market so far this year have actually been very close to the number indicated by the USDA December Hogs and Pigs Report. When adjusted for the number of slaughter days compared to last year - he says the slaughter count is down about .5-percent so far. But market weights - he says - have been higher by about 2.5-percent - resulting in total pork production being up about two-percent. Hurt says prices for the March through July period this year suggest that market participants believe hog slaughter supplies could be down seven to 10-percent during this time period. If the actual impact is closer to three to four-percent, then futures prices may ultimately have to adjust lower. He notes all great uncertainties eventually get resolved in the marketplace - and for the hog market - that will occur as the actual number of slaughter hogs coming to market from March through July is seen.
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