… The protein industry is just beginning to understand the impact of the loss of 200 million-plus pigs in China on the worldwide protein markets… ASF is not a new virus… “You just can't solve this problem”…
Large Swine Herd Losses in China Pressure Protein Industry
Jennifer Shike, FarmJournal's Pork
May 8, 2019
The protein industry is just beginning to understand the impact of the loss of 200 million-plus pigs in China on the worldwide protein markets. Phibro Animal Health Corporation announced disappointing financial results for its third quarter ended March 31, 2019, on a call Monday, including a $5 million decrease in net income and a $3 million decrease in net sales.
“Looking ahead, we do expect substantially weaker sales in China as African swine fever reduces demand. We have reset our expectations for our fiscal year ending June 2019 to reflect the headwinds we are facing, including, among other things, the disruption of African swine fever in China. We continue to believe our business is well positioned to support the global protein industry as it responds to increasing demand,” said Jack Bendheim, Phibro’s chairman, president and chief executive officer.
Bendheim has made multiple trips to China over the last few months to better understand African swine fever (ASF) and its impact on the world’s largest hog producer.
“We are entering a period without precedent in the global production of protein,” Bendheim said. “Rabobank recently published an estimate of 30% of herd loss a few days ago, and my personal opinion is that the loss would be much greater than that.”
His sources in China estimate more than 50% losses in China’s 700-million-head herd. This is equivalent to all of the pigs the rest of the world raises.
ASF is not a new virus, and over the years, many have responded with good biosecurity to manage the virus. Bendheim believes it will be extremely hard for China to manage the virus, however, because they have such a high number of backyard farms.
“You just can't solve this problem,” he said...
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