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Misplaced influenza fear could affect grains

The US Grains Council says the “fear-based misconception” about the influenza outbreak is pushing global pork demand lower and could potentially affect grain demand. Julio Hernandez, USGC’s director in Mexico and Central America says the current atmosphere in Mexico, where they’re incorrectly linking the H1N1 virus to the safety of pork products is, in his words, “unbelievably crazy.” Hernandez says the fact that the virus cannot be picked up from eating pork and that the flu is not present in US pigs or any pig herd is not being heard and is pushing demand for pork lower in Mexico. That, in turn, he says, could reduce demand for feed ingredients. Hernandez says the Mexican Swine Producers Confederation reports a 30 percent drop in purchase orders of pork for Mexico City this week. Mexico is the largest market for U.S. DDGS and sorghum and the second largest market for U.S. corn. Mexico’s hog production, for the moment, has not changed, but there’s around a 10 percent drop in market price.If the market demand is reduced by 20 percent, Hernandez says feed demand could drop considerably. He’s optimistic, though, that eventually the virus will be under control and pork demand will recover quickly.