The impact of Hurricane Florence blows into this edition of Futures File, our weekly commodities wrap-up.
Florence chases hogs to higher levels
As Hurricane Florence bore down on the Carolinas, millions were at risk from wind, storm surge and flooding, causing many to seek higher ground.
Meanwhile, North Carolina hog farmers faced a unique challenge: keeping nearly 9 million hogs safe. North Carolina is the United States’ second-largest hog producer, making about 15 percent of U.S. pork. Some farmers are moving the animals to higher ground, while others are preparing for power outages and shortages of grain to feed the hogs.
Another concern is that heavy rainfall could cause waste-filled lagoons on hog farms to overflow, creating an environmental hazard.
Aside from immediate risk to the animals during the storm, damage to infrastructure could keep slaughterhouses closed, creating a short-term backlog of hogs coupled with a pork shortage.
On Monday, December hog futures contracts blew to a two-month high as storm fears surged, only to retrace slightly during the week as the storm weakened slightly. Markets traded for 57 cents per pound on Friday.
Other markets that could be affected by Hurricane Florence include cotton (7 percent of U.S. cotton is grown in the Carolinas) and especially tobacco, as North Carolina is the largest tobacco-growing state.