US builds lesser pork supplies than anticipated

The US Department of Agriculture's monthly Cold Storage report reveals that pork stocks in storage was up only 0.8 percent in May from a year ago, alleviating fears that AH1N1 and export declines might build pork supplies excessively.

J.P. Morgan analyst Ken Goldman wrote in a note to investors that that this data will not drive pork prices higher immediately but the industry is however selling higher volumes than feared, even if prices are weak.

The only cut to see rising inventories during May was hams, which were up 23.5 percent from April, but even those stocks were more than 28 percent lower than one year ago, noted the CME Group's Daily Livestock Report. The report added that "one less slaughter day this May versus May 2008 helped all of the meat/poultry species, and the gloomy outlook for pork prices removed incentives for processors to freeze very much product."