U.S. ham and pork prices extended a slump as trade tariff hurdles involving giant consumers China and Mexico back up exports and inventories.
As of Wednesday, wholesale ham slumped 25 percent in the past 12 months to 42.97 cents a pound, the lowest since April 2015, U.S. Department of Agriculture data show. Pork dropped 18 percent to 63.88 cents a pound, the cheapest since December 2009.
“The short-term supply situation is still burdensome, ” according to the Hightower Report. Animal weights have gained, and adverse winter weather roils slaughter rates.
Hog futures for April settlement on the Chicago Mercantile Exchange are down 17 percent in the past 12 months as investors appear to shrug off the shrinking herd in China, reduced by the outbreak of Asian swine fever. In January, the Asian nation culled more than 900,000 animals because of the deadly virus.
“China wants to tell everyone that they have gotten ahead of ASF and then they find some more,” David Kruse, president of Commstock Investments in Royal, Iowa, said Thursday in a report. “I doubt that they are even close, but pork prices there have not sprung to life yet.”
China will boost purchases after domestic supplies run down, Kruse said. “When everyone gets tired of waiting, then it will happen.”
Meanwhile, trade talks between the U.S. and China drag on, and the prospects for speedy congressional approval of the U.S.-Mexico-Canada agreement diminish after a key analysis was delayed.