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·         China's 2019 pork production to fall 30 pct - Rabobank analyst

… The drop in production will mean China will have to increase pork imports by 1.5 million tonnes to around 4 million tonnes, sucking in all available supplies from the global market, Rabobank analyst Sherrard said…

 

·         China Consumer Inflation Surge Seen as Unlikely to Shift PBOC

Pork prices jumped 5.1%, first increase in more than two years

 

 

China's 2019 pork production to fall 30 pct - Rabobank analyst

 

Reporting by Dominique Patton. Editing by Jane Merriman, Reuters

April 11, 2019 / 8:29 AM

 

BEIJING, April 11 (Reuters) - China’s 2019 pork output will fall by 30 percent compared with the prior year after an epidemic of incurable African swine fever spread throughout the world’s largest hog herd, a Rabobank analyst said.

 

Production is seen at around 38 million tonnes versus 54 million tonnes last year, Justin Sherrard, global strategist for animal protein at Rabobank, told Reuters, citing the company’s latest forecast.

 

China, which produces about half of the world’s pork, has reported about 120 outbreaks of the disease since August last year but many in the industry say it is much worse than reported.

 

The disease kills almost all pigs infected though it is not harmful to people. There is no vaccine or cure.

 

China’s agriculture ministry said last month that the national pig herd in February had fallen 16.6 percent year-on-year, and sow stocks were down more than 19 percent.

 

The number is much higher in some regions however. Stocks of breeding pigs in major Chinese hog producing region Shandong plunged 41 percent in the seven months to February, provincial authorities said.

 

Pig prices have soared, with rising pork prices driving consumer inflation in March to its highest since October 2018, data showed on Thursday.

 

The drop in production will mean China will have to increase pork imports by 1.5 million tonnes to around 4 million tonnes, sucking in all available supplies from the global market, Rabobank analyst Sherrard said.

 

Domestic production and imports of other animal proteins like poultry, beef, mutton and seafood will also increase to partially close the gap, the analyst said, but there could still be a gap of as much as 10 million tonnes, he said...

 

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https://www.reuters.com/article/china-swinefever-pork/update-1-chinas-2019-pork-production-to-fall-30-pct-rabobank-analyst-idUSL3N21T33L

 

 

China Consumer Inflation Surge Seen as Unlikely to Shift PBOC

 

    Pork prices jumped 5.1%, first increase in more than two years

    CPI to rise further but factory deflation risks remain: CICC

 

Bloomberg News

April 11, 2019 

 

China’s consumer prices surged on the back of temporary food supply factors, while factory inflation provided further evidence of a nascent economic recovery.

 

Consumer inflation accelerated to 2.3 percent in March from a year earlier, up from 1.5 percent in February and posting the biggest jump in more than a year. The surge was mostly led by rising vegetable and pork prices, which drove the CPI up by more than half a percentage point, according to the National Bureau of Statistics.

 

Core consumer prices, excluding food and energy, stayed flat at 1.8 percent, and factory inflation halted a dis-inflationary slide, gaining 0.4 percent.

 

Because the inflation rebound was driven by food-price increases that may prove temporary, the central bank is unlikely to abandon its policy of keeping cheap money flowing to the private sector for now. Lingering deflation risks and uncertainties over the trade war and the sustainability of the economic upswing also argue for caution.

 

“Monetary policy won’t make adjustments, and overall inflation won’t be a big issue for this year" because core inflation remains steady and factory-gate prices will stay at a low level going forward, said Ding Shuang, chief China and North Asia economist at Standard Chartered Bank Ltd. in Hong Kong. The People’s Bank of China is likely in an “observation window” at the moment.

 

Pork prices, a key element in the country’s CPI basket, rose 5.1 percent in March, the first increase after 25 months of decline. That alone drove the CPI to rise 0.12 percentage point, the NBS said in a statement. Over a million hogs were culled in an outbreak of African swine fever and pig feed output has dropped.

 

Rebounding factory prices signal a further firming in the nascent economic recovery, which if sustained give firms greater pricing power, aid profits and the help them repay their debts.

 

“The PBOC still have good reasons to cut reserve-requirement ratios again because there’ll be tax collection and maturing medium-term lending soon,” Ding from the Standard Chartered Bank Ltd said.

 

“Even if there’ll be policy shifts, it probably won’t come from monetary policy as it’s never been very loose”, he said, adding the pace of fiscal expenditure can slow down to save some bullets, if the economy does turn around.

 

The outlook for producer-price inflation is still modest. The PPI index will likely grow by just 0.3 percent in 2019, according to the median estimate of 15 economists in a Bloomberg survey, down from a forecast of 0.8 percent in February.

 

What Bloomberg’s Economists Say...

 

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https://www.bloomberg.com/news/articles/2019-04-11/china-consumer-prices-surge-in-march-as-factory-inflation-gains