Virus in Pig Industry Could Send Prices To Record High

PED virus, which appeared in the U.S. for the first time in April, has spread to 22 states and killed thousands of piglets.

A virus that kills young pigs is causing havoc across the U.S. pork industry, threatening to boost prices in the $9 billion hog-futures market and higher prices for food shoppers at the register.

Porcine epidemic diarrhea virus, or the PED virus, which has spread to farms in 22 states, is reducing pork supplies and prompting some traders and investors to wager that hog prices could set records this year. Lean-hog futures rose to a seven-week high a week ago and are up 6 percent since mid-December.

The virus, which causes severe diarrhea and vomiting, is fatal only to young pigs and poses no threat to human health or food safety, according to swine veterinarians. The U.S. strain is nearly identical to a version that hurt hog production in China in 2012.

The extent of the impact is unclear because farms don’t have to report incidents or death totals to federal regulators. Smithfield Foods Inc., the world’s largest pork producer, and other meatpackers estimate that about 10% of the nation’s sows, or adult female hogs, have been infected by the virus, which can spread to their offspring.

Smithfield, a unit of China’s Shuanghui International Holdings Ltd., said last month the virus could result in a loss to U.S. pig production this year of two million to three million head, or up to 3 percent of the industry’s total. Hormel Foods Corp., also warned recently its earnings for fiscal 2014 could be affected by “potentially volatile hog costs” due to the virus.

To ward off the disease, many U.S. hog farmers are redoubling safety practices, including disinfecting equipment and workers’ footwear, but most in the industry say they are finding it difficult to prevent. To read more, click HERE.