China Loads Up on U.S. Pork Despite Trade Tariffs

China-US trade relations are often confrontational, but important to each country.
( MGN )

As African swine fever continues to ravage the Chinese hog supply, China is buying more U.S. pork despite the import tariffs imposed due to the trade war.

The world’s top pork consumer placed its largest order for U.S. pork since trade tensions began escalating between China and the U.S. In the week to Nov. 22, China bought 3,348 tons of pork to be shipped this year, USDA said. Weekly U.S. pork sales overall totaled 34,000 tons for the 2018 and 2019 marketing years.

China’s retaliatory tariffs on imports of U.S. farm products in the tit-for-tat trade row include duties of 62% on U.S. pork.

President Donald Trump and Chinese President Xi Jinping are scheduled to meet on Saturday at the G20 summit in Buenos Aires.

U.S. Trade Representative Robert Lighthizer said he is sure there will be a "positive feel" on both sides after the talks and said he would be surprised if they were not a success, reports Jim Wiesemeyer of ProFarmer. Lighthizer steered clear of offering any clear statement on whether Trump and Xi are likely to resolve their trade differences.

China might also buy it's own domestic pork to bolster its state reserves to support farmers struggling to sell pigs during the African swine fever epidemic.

Yao Guiling, analyst at China-America Commodity Data Analytics, said the ministry proposed stockpiling at a government meeting with pork producers this week, according to Reuters.

China consumes about 55 million tonnes of pork a year. It is not known how much meat Beijing keeps in reserves or how much pork Beijing would buy, but the purchase would support prices in areas that have not been able to sell their hogs to places with demand, said Wang Zuli, chief expert on pig production at the Ministry of Agriculture and Rural Affairs.

Chinese pig farmers are starting to get rid of animals to cut their losses after prices dropped following Beijing’s decision to ban the transport of live pigs from infected regions to slow the spread of this disease.

“Basically every hog that’s culled or killed to try to control this disease is a hog that has to be imported,” said Dennis Smith, a broker for Archer Financial Services in Chicago.

The Chinese government urged major pig producers at the meeting to diversify into slaughtering and increase processing capacity closer to their farms, reducing the need for transporting live animals, Guiling said.

Related Links:

Hog Futures Respond to News of U.S. Pork Sales to China

Trump’s Tariff Threats Strike a Tone Before Meeting with Xi Jinping

Lighthizer Lashes Out at China’s Tariff on U.S. Automobiles