We recently noted the soaring cost of US foodstuffs this quarter (handily outperforming stocks) [4] but without a doubt it is lean hogs that are the best performer - up a stunning 51% in Q1. As Bloomberg reports [5], the reasons are varied and, fair warning, sometimes disgusting: The same Ukraine story that is helping to keep a lid on equities is fueling a rally in wheat on concerns about Russian crops; the pigs in China are gobbling up U.S. soy, while the hog supply in the U.S. is being hurt by a nasty case of “porcine epidemic diarrhea virus.”
Via Bloomberg:
So far in 2014 it’s worth taking note of the leaders to show that while alpha may not grow on trees, it can sometimes grow in the fields:
Lean hogs are up 51 percent this quarter.
[6]
Corn is up 16 percent.
[7]
Even untradable chicken wings (specifically the USDA Georgia Dock Chicken Ready To Cook Wings Spot Price) are up 8.9 percent.
[8]
And of course, the broad US Foodstuff index
[9]
Must be the weather? But summing it all up - Q1 has been the quarter of food inflation and financial asset deflation
[10]