By Curt Thacker
  Of DOW JONES NEWSWIRES


  KANSAS CITY (Dow Jones)--Lower projections for 2009 U.S. pork exports and hog
prices are expected in the U.S. Department of Agriculture's monthly
supply/demand report to be released Wednesday.

  The aftermath of the discovery of A/H1N1 influenza and outbreaks of the
disease in late April in Mexico and the U.S. weighed heavily on cash hog and
wholesale pork prices during the balance of April and throughout May. There
were several deaths reported from the disease as well, mainly in Mexico, at
that time.

  Because the disease was initially called swine flu, some consumers were
concerned about the safety of eating pork. Demand dropped, particularly in
Mexico, which so far has been the hardest hit by the influenza. There is no
danger from eating properly handled and prepared pork, health officials have
said.

  Temporary bans on pork imports were initiated by several countries, and
partial or full bans still in effect by a few have resulted in slowed U.S. pork
exports, according to industry participants. Russia has bans in place on pork
imports from some U.S. states, and China has a temporary ban on all U.S. pork.

  The international markets took nearly 20% of the pork produced in the U.S. in
2008, when volume and value for exports easily set new records. Exports
remained strong during the first quarter of this year, according to USDA data,
with total pork and pork variety meats up 8% by volume and 10% by value from a
year ago.

  Figures for April export sales are due out later this week and should provide
an indication of a late-month decline, analysts said. A more significant
reduction in pork exports could be seen in May, but that data will not be
available until mid-July.

  A decline in pork exports during the second quarter and possibly beyond would
mean more pork available to be absorbed domestically, so USDA's per-capita pork
figure will likely be raised a bit in Wednesday's report, analysts said.

  Pork exports were likely off significantly in May and so far in June,
analysts said, but shipments may begin to recover later this month or in July.
Mexico, which was the largest international customer by volume for U.S. pork
and pork variety meats during the first quarter and accounted for 28% of the
total, has purchased little pork since the influenza outbreaks occurred. Recent
reports of improved consumption of pork in Mexico have raised hopes that some
new orders for pork will be placed with U.S. packers within the next few weeks.

  Some analysts and brokers predict the amount of shortfall in exports from
late April through May could be around one-third of the monthly averages for
January through March. If so, that would amount to about 54,000 metric tons, or
120 million pounds. Similar declines may occur in June as well, but it's too
early to tell. If Russia, China and other countries lift their temporary bans
soon, perhaps some additional pork could leave the U.S. by the end of this
month, they said. But that seems unlikely.

  Hog prices have been negatively affected by the loss of export sales. USDA
officials said that producer returns from April 24 through early last week were
down about $153 million from expected levels for that period. Since prices
remain well below normal and the slump could continue, it's likely that USDA
will lower its projected prices for 2009 in Wednesday's report, analysts said.

  Steve Meyer, owner/analyst at Paragon Economics in Des Moines, Iowa, said he
hopes that USDA will also downwardly adjust its projected pork production
figure for 2010. Based on producers' financial losses, expectations that hog
producers will trim their breeding herds by 3% to 5% or more by the end of this
year should translate to lower output next year, he said.