Volatility in the hog markets

Large hog supplies and uncertain Chinese trade have caused turbulence in the hog markets.

HAMS Marketing Services Director of Risk Management Tyler Fulton said the trade situation with China continues to add a higher level of uncertainty to an already tense North American hog market.

He said with large U.S. hog supplies and increasing production the value of any hogs not under contract is dropping rapidly. But, on the pork side, the past two weeks or so have seen added support.

“That’s led to a divergence in cash hog pricing because some producers are referencing that pork price that packers are selling for while others that don’t have a secured contract, those values are dropping very sharply,” Fulton said. “There’s a great deal of uncertainty and it’s a unique circumstance to see these markets moving in opposite directions.