January 8, 2020 / 10:35 PM / 9 days ago

LIVESTOCK-Chinese buying drives record U.S. pork exports in November

CHICAGO, Jan 8 (Reuters) - U.S. pork exports in November surged to a record high for any month, according to new government data, driven by a fatal pig disease that is stoking a meat shortage in China.

The shipments fueled expectations for more big sales to China, although U.S. hog futures slumped on Wednesday.

China, the world’s largest pork consumer, needs to increase imports after its hog herd shrunk by about half because of an outbreak of African swine fever. The losses have pushed Chinese pork prices to record highs and roiled global meat markets. China has also increased imports from Europe and Brazil.

“They just have a terrific need,” said Bob Brown, an independent U.S. livestock market analyst. “They’re needing to take it when they can find it.”

Traders will review weekly U.S. export sales data on Friday, one day later than usual because of a winter storm in Washington.

In November, total pork exports reached 259,814 tonnes, up 26% from a year earlier and 11% above the previous high set in July 2019, according to U.S. Department of Agriculture data. Sales to China soared 589% from a year ago to 78,776 tonnes, about 35% of which were frozen carcasses. For January through November, exports to China jumped 134% to 472,811 tonnes, the data show.

“The surge in pork shipments to China will capture most of the headlines this month,” said Dan Halstrom, president of the industry group U.S. Meat Export Federation.

China maintains retaliatory tariffs on imports of U.S. pork, imposed in the U.S.-China trade war, giving an advantage to suppliers in Europe and South America. Still, analysts expect U.S. exports to rise further in 2020 because of China’s shortfall from African swine fever.

U.S. President Donald Trump has said a so-called Phase 1 trade deal with Beijing would be signed on Jan. 15. It includes a commitment by China to buy more American agricultural products, although details have not been announced.

“Their prices are high enough that they could pay the tariff and still make money,” said Steve Meyer, economist for U.S. commodity firm Kerns and Associates.

Most actively traded February lean hog futures ended down 0.200 cent at 69.025 cents per pound at the Chicago Mercantile Exchange. In the beef market, February live cattle futures slipped 0.175 cent to 126.350 cents per pound. March feeder cattle futures advanced 1.400 cents to 146.525 cents per pound. (Reporting by Tom Polansek in Chicago; editing by Grant McCool)

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