Chinese Pork Prices to Surge 70% as ASF Curbs Supply

The U.S. is well positioned to help fill any additional need that China has for pork, said Joe Schuele, U.S. Meat Export Federation, “but we’d be in a lot better position if we weren’t facing a tariff that’s five times higher than everybody else.” ( MGN )

There’s a high level of anxiety for U.S. meat exporters, said Chip Flory, host, on AgriTalk Wednesday. It comes from staring at a huge opportunity to supply a growing worldwide demand for meat.

“Meat exports have been going very well, especially on the beef side,” said Joe Schuele, U.S. Meat Export Federation, told Flory. “We've been on a big roll for U.S. beef—about $8.3 billion last year, just a remarkable number. On the pork side [we] have been hit a little bit harder on the trade disputes. But yet, pork exports are hanging in there and we had a solid year in 2018. And [we’re] off to a fairly good start in 2019, despite the headwinds. But those opportunities are pretty fragile. It’s a very, very competitive global market.”

However, our global competitors also see those opportunities.

China Holds Greatest Unknowns

Chinese pork prices are set to jump 70% in the second half of the year, reports a senior government official Wednesday, according to Reuters. This news comes as African swine fever continues to devastate the country’s hog industry, cutting the herd by 10% in the first quarter.

China’s pork production fell 5% in the first three months of 2019 and bigger declines are expected in coming quarters, the analysts said.

“China produces and consumes about half of the world's pork. Their pork industry is really so massive, it's hard to wrap your head around it. So whenever China has anything that affects its production, whether it's an animal health issue or just maybe a down cycle in its production, all of the world's pork exporters' perk up and look for opportunities in China,” Schuele told Flory.

The U.S. is well positioned to help fill any additional need that China has for pork, he added, “but we’d be in a lot better position if we weren’t facing a tariff that’s five times higher than everybody else.”

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Click to listen to Scheule’s analysis of the U.S.-Mexican pork trade, and the new Trans-Pacific Partnership with Japan by clicking the player above. 

 

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