U.S. lean hog futures jumped more than 4% Thursday after USDA’s weekly export sales report showed China placed its largest order last week for American pork since February, says Reuters.
These purchases signal that China’s African swine fever outbreak is raising concerns of an eventual supply shortfall, potentially overriding trade tensions between the world's two largest economies. Until now, China has refrained from increasing its imports from the U.S.
In the week to Nov. 22, China bought 3,348 tonnes of pork to be shipped this year, USDA said. Weekly U.S. pork sales overall totaled 34,000 tonnes for the 2018 and 2019 marketing years.
“We sold pork to China for both 2018 and 2019. It might be the first sign of the impact it (African swine fever) is having over there," said Jim Gerlach, president of Indiana-based A/C Trading.
Chicago Mercantile Exchange February lean hog futures settled up 2.850 cents at 67.350 cents per pound while front-month December rose 0.775 cents to end at 58.725 cents.
African swine fever outbreaks have been reported at farms in 20 Chinese provinces since August, with about 600,000 hogs culled.
China Loads Up on U.S. Pork Despite Trade Tariffs