Fear of African swine fever (ASF) is on the rise in China and beyond. Major Chinese animal feed maker Tangrenshen Group reported Sunday that feed produced by one of its units had been contaminated with ASF.
Although speculation was circulating, this is the first reported contamination of feed supplies in China and increases the concerns for pig farmers trying to avoid the disease. It also raises the economic pressure on feed manufacturers already struggling with low margins and slowing demand, reports Reuters.
In a statement to the Shenzhen Stock Exchange, the company said the disease was found in feed samples provided by its 51 percent-owned subsidiary, Bili Meiyingwei Nutrition Feedstuff. Reuters reported that this discovery occurred during inspections after an outbreak of African swine fever on a farm in Qingyang county located in the eastern Chinese province of Anhui. Tangrenshen said the origin of the disease remained unclear and the matter was still under investigation.
African swine fever has now reached most of the country’s pig-farming regions. China produces almost 700 million pigs a year, or about half of the world’s total.
According to Reuters, many of the cases in Anhui were caused by feeding kitchen waste to pigs that was not properly processed to kill the virus. However, industry experts have long suspected feed supplies could be contaminated with the disease.
African swine fever is known to survive for weeks in feed ingredients like soybean meal. Once the feed is contaminated, it’s very difficult to control, said Pan Chenjun, senior analyst at Rabobank.
Tangrenshen relies on animal feed for most of its income, reporting 2017 feed sales of 12.6 billion yuan ($1.81 billion). Like many Chinese feed companies, it has recently moved into pig farming and processing. It acquired Bili Meiyingwei, also known as Shenzhen PREMIXINVE Nutrition Co. Ltd, from Belgian feed maker INVE Belgium in 2016, reports Reuters.
The company said the impact on its operations would be “relatively small,” with Bili Meiyingwei accounting for only 2.27% of the group’s net profit in the first nine months of 2018. The group’s shares fell as much as 6.6% on Monday to 4.56 yuan ($0.66).
African swine fever has ravaged many small pig farms in Anhui, but authorities had recently lifted restrictions in four cities there after no new cases were reported for six weeks. That ended last weekend when a new outbreak was discovered on a farm with 8,339 pigs in Qingyang county in the south of Anhui.