May 4, 2009

US hog prices moved higher on Friday, after steep losses earlier in the week, as investors appeared to believe the worst of the flu-related trade disruptions may be over and that some trade bans on US meat and pork could soon be lifted.

The hog market is currently down about 10 percent in most contracts for the week after many countries banned pork or meat from several US states that had human cases of the flu.

Originally called swine flu, the bans were apparently applied to curb its spread. The flu, now called A/H1N1 influenza by the World Health Organization (WHO), is spread by humans, not by hogs or pork.

The National Pork Producers Council (NPPC) predicted the bans on US pork could be lifted soon. Mexico on Thursday (Apr 30) asked WHO to investigate the trade bans and urge that such bans should not be taken.

US Meat Export Federation (USMEF) said bans have cut US pork exports 8 to 12 percent, while pork sales to Mexico have slowed as that country has restricted economic activity to slow the flu's spread.

US hog prices at the Chicago Mercantile Exchange were mixed, with May hogs down 0.250 cent at 57.850 cents per pound and the actively traded June hogs up 1.500 cents, or 2.3 percent, at 66.025 cents per pound.

For the week, the June hogs are down 7.6 percent.

In pork bellies, which are used to make bacon, the July contract rose the 3-cent daily limit on Friday (May 1) to 78.125 cents per pound.

Shares of US hog and pork producer Smithfield Foods Inc briefly traded higher on Friday after being driven lower much of the week.

At the New York Stock Exchange, shares of Smithfield Foods were up 3 cents, or 0.35 percent, at US$8.67, after trading up to US$9.12 earlier in the day. For the week, the shares are down nearly 16 percent.