A huge tornado tears through the Oklahoma City suburb of Moore, killing dozens. Slideshow
Swine flu jitters spark sell-off in U.S. hogs
CHICAGO (Reuters) - U.S. hog futures fell to a two-month low on Friday in a late sell-off amid nervousness over a swine flu outbreak that has killed up to 61 people in Mexico, a top export market for American pork.
The virus, a strain of flu never seen before, has spread into the United States, where eight people in California and Texas have been infected but have recovered.
"If they (consumers) decide to look at it, it can only be negative. There's nothing positive about it because it's (flu) on our property and then we have to worry about exports," said Gilbert Goodman, a lean hog futures trader.
"It's not a factor right now, but if they start changing their minds, you know how these markets move."
In 2008, Mexico was the top export market for U.S. beef, with sales valued at nearly $1.4 billion. It was the No. 2 market for U.S. pork, valued at $691.28 million.
Chicago grain markets that trade in corn, soybean and wheat showed no reaction to the outbreak of swine flu.
The World Health Organization said tests showed the virus in 12 of the Mexican patients had the same genetic structure as a new strain of swine flu seen in the eight Americans.
Traders said the market became more nervous late in the trading session -- even though the disease is not transmitted through hogs -- as news of the deaths in Mexico and infections in the United States spread on Friday.
Traders pointed to the slump in beef exports when the first case of mad cow disease in the United State in 2003 became a market factor as a lesson for their caution on Friday.
"You do have people spooked because of the swine flu," said James Burns, a lean hog trader.
"If the public starts to get involved with the market, and if they get wind of something that may or may not be rational, pressure is going to get out. I think you saw that pressure late in the day in the June," Burns said.
But futures did trade higher much of the day as cash hog markets have been trending higher on seasonal factors. Hog supplies ease in the spring, following reduced farrowings in the fall and as farmers focus on spring planting.
Expectations were for strong cash hog markets next week, despite negative packer margins, and even firmer cash markets next month.
May lean hogs closed off 0.550 cent at 69.000 cents per lb, while actively traded June was off 0.225 at 71.650 cents. May posted a new two-month low.
(Editing by Walter Bagley)
- Tweet this
- Share this
- Digg this