Hog futures contracts continued exploding higher this week, setting new price records across all contracts. Markets rose the exchange maximum price for two days straight, locked “limit up,” as traders scrambled to buy bacon.
Prices have risen by over 50% during the last month as the effects of African swine fever in China worsen, likely killing millions of animals in the world’s largest pork-producing country. The deadly disease has no known cure or vaccine and has been spreading rapidly, threating pork supplies.
China has been preventatively culling hog herds to control the spread of the disease but with little success so far. In the coming months, China is expected to significantly increase its pork imports, much of which would likely come from the United States.
Looking ahead, the biggest concern is that the disease continues to spread within China and to new countries, although most experts believe the disease poses little threat to the U.S. due to better biosecurity and safety measures here.
As of midday Friday, April hog futures were worth 78.4 cents per pound.