World meat industry news

We have gained $8.00 in October hogs in about 10 days. We still have an inverted basis but I don’t think that will continue - it will widen. This is as sure as death and taxes, writes Allan Bentley, Sales & Service.

Here is the unknown, will cash fall or futures continue higher? The calendar says cash will fall but that is not rocket science. As I mentioned, the futures have recovered a substantial amount. Retracement charts tell me that October hogs will run out of steam at these prices. Demand is good and I am not hearing any problems getting hogs to packers on a timely fashion.

I think the million-dollar question is - what will the effect be of the bird flu and its return this fall? I am starting to hear that bird flu could be a bigger issue this fall then last spring. The general worldwide economy issues and the bird flu will have a bigger influence on prices during the next 12 months than how many hogs are coming to town. The elephant in the room is always what will China do since they have devalued their currency.

One more important issue to watch is Obama’s announcement of sanctions against Chinese companies who have benefited from the cyber thefts by the Chinese government. A trade war with China will also put a completely new spin on all of agriculture production; remember the United States is not the only exporter of pork! Markets are frustrating when the general supply and demand rules are trumped by outside factors.

Sad to say, but I believe that is what will happen going into this fall and winter. Did I just use the word “Trumped” in an upcoming election year?