US pork supplies tumble as demand bolsters exports

American pork stored in warehouses fell a surprisingly large 5.6 percent from October to November.

The numbers indicated a surge in exports as analysts attribute to the global economy's improvement from the steep recession.

The U.S. Agriculture Department's Cold Storage report put total frozen pork supplies held in refrigerated U.S. warehouses at 487.2 million lbs as of Nov. 30, down more than 29 million lbs from the total in October.

"It is very bullish for pork. The drawdown was 29.1 million lbs, when the five-year average is 7.5 million lbs," said livestock analyst Rich Nelson of Allendale Inc.

The USDA report said November frozen pork supplies were down 7.5 percent from 526.7 million lbs a year ago.

"The economy worldwide is showing some improved demand," Nelson said, adding that pork was able to draw away some consumer demand from beef and chicken breasts.

In the most recent USDA report on meat exports, pork exports for October grew to 378.4 million lbs from 352.5 million during September. November export numbers will not be available until mid-January, but many expect pork exports to rise again and exceed the year ago exports of 344.3 million lbs.

"The total pork number is friendly as it confirms what we have been seeing from the export front- pork demand is very good, especially for hams. The belly number is not particularly friendly, however," said Dan Norcini, independent hog futures trader.

"This report should reinforce the idea that pork demand continues to be robust. That will support the hogs on setbacks in price. Near term, however, the front month February will have to shrug off pressure from the current sloppy fundamentals particularly as ham prices are now dropping rapidly," Norcini added.