Hog prices are nearing the highest level for the year, trading over 68 cents per pound Friday.
The market has been rising as U.S. and Chinese demand for pork has been increasing over the last month, but prices skyrocketed on news that African swine fever was discovered in Germany.
The disease, which does not affect humans but is highly lethal to hogs, ravaged China last year. A wild boar infected with the disease was found in Germany, leading to concerns that its domesticated hogs could be threatened as well. Germany is the largest pork exporter in Europe.
In a rapid response, South Korea, Germany’s second-largest buyer, placed a ban on German pork, and markets fear that China could do the same. As a result, German hog prices collapsed by over 10% overnight.
Meanwhile, U.S. prices exploded as traders assumed that foreign buyers will be increasingly looking to American pork, perceived as safer and virus free.
Saudis slash oil prices
Oil fell to a three-month low this week, dropping near $36 per barrel. Tuesday’s decline was the largest single-day slide since June.
Prices are weakening as concerns about the global economy and COVID-related travel restrictions continue to nag markets.
To offset weak demand, Saudi Arabia announced that it was dropping prices. Saudi Arabia is one of the world’s largest oil seller, so its moves reverberate through the industry.