How coronovirus, ASF and the Chinese New Year are affecting the pig market in China
By Alistair Driver, Pig World (UK)
February 6, 2020
China’s coronavirus outbreak has had a limited impact on pork trade so far, but could create challenges in the market in future, according to AHDB analyst Bethan Wilkins.
The outbreak has coincided with the Chinese New Year holiday period, which is already a quiet period for business. “So, so far, disruption to imports has probably been limited,” she said.
However, this week though, China suspended pork trading, seemingly to investigate whether the meat can carry the virus between regions. “Although trade is to be resumed next week, the US hog futures market reacted negatively to the news. It is possible that further logistical problems could emerge going forward,” Ms Wilkins said.
But there could be an upside, too, in terms of trade. “On the other hand, Brazilian exporters (including JBS) reportedly believe the coronavirus outbreak could increase demand for imported pork, due to concerns around domestic food safety. Clearly, with the situation still developing, any possible impact is difficult to anticipate at this time,” she added.
“Nonetheless, considering the extent of the supply gap expected, it currently still seems likely suppliers will find ample opportunities, and strong prices, on the Chinese market this year.”
Pork prices in China have been at historically high levels since August. In December, the national pork price averaged CNY 47/kg (£5.27/kg), live pig prices were CNY 34/kg (£3.81/kg) and piglets averaged nearly CNY 90/kg (£10.08/kg).
These prices are slightly below the October/November peak, Ms Wilkins said. “The government has taken action to quell escalating prices for the Chinese New Year celebrations in late-January. Frozen pork stocks have been released and import levels have increased. Nonetheless, prices are still more than double year-earlier levels, and much higher than the previous peak in 2016,” she added.
In 2019, pig meat and offal imports to China were up 41% year-on-year, totalling just over 3 million tonnes, with volumes higher by 97% in the final quarter. Imports in November and December increased by 93% and 121% respectively.
Spain and Germany remain the top suppliers...
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