The World Health Organization declared the novel coronavirus a global health emergency after the outbreak expanded significantly last week, reaching 20 countries and sickening nearly 10,000 people, with more than 200 deaths.
The designation will mobilize resources to fight the disease, but the organization issued a stern statement against overreaction, warning against “measures that unnecessarily interfere with international trade or travel.”
However, there have already been significant impacts, with nearly 60 million Chinese placed under travel restrictions, while neighboring countries such as Mongolia, Russia and North Korea are closing borders to trade and migrants.
As scientists study the outbreak, they are coming away with positive findings. The virus appears to have a shorter incubation period than originally feared and is less deadly than other similar outbreaks, which may lessen the ultimate impact.
As a result of the disparate signals between government reactions, scientific research and public concern, markets seesawed all week, with stocks and oil near their lows Friday.
Pork market slashed
Hog futures collapsed last week as markets grew increasingly worried about U.S. exports of pork. The market rallied into the new year on the expectation of the trade deal with China but have been disappointed with a lack of immediate sales. Analysts had been concerned about China’s ability to meet its import obligations under the deal, and the coronavirus outbreak has exacerbated worries about future Chinese demand.
As a result, hogs lost over 10 cents per pound, a loss of 15 percent, with the February contract trading Friday near a one-year low at 58 cents per pound.
Pound in limbo
The United Kingdom officially left the European Union Jan. 31, but still much remains unknown about the future of the relationship.
As part of the negotiated exit, the UK will continue to be part of the EU’s single market until the end of the year, allowing for a free flow of goods and people. Leaders are meeting in March to determine what the long-term deal will be.
For now, most market watchers are still optimistic about a deal, with the British pound worth $1.32, near the highest level of the year.
Walt and Alex Breitinger are commodity futures brokers in Silver Lake, Kan. They can be reached at 800-411-3888 or paragoninvestments.com. This is not a solicitation of any order to buy or sell any market.