Pig pandemic adds to German pork sector pain as exports banned
By Michael Hogan and Nigel Hunt, Reuters
September 14, 2020
HAMBURG/LONDON (Reuters) - An outbreak of African Swine Fever threatens to keep German pork locked in the European Union with China, South Korea and Japan all banning shipments, a major setback in an already challenging year for meat producers following COVID-19 outbreaks at plants.
German wholesale pig prices fell 14% on Friday after a case of ASF was found in a wild boar in the east of the country and major buyers on the international market quickly responded by banning shipments from the EU’s top producer in what was due to be a big sales year.
In China, the world’s biggest pork producer, the disease caused hundreds of millions of pigs to be culled and raised imports of protein from other sources.
German pork exports to China are worth around 1 billion euros ($1.2 billion) annually, and volumes had doubled in the first four months of this year on soaring demand after Chinese output shrank around 20%.
“The Chinese export stop is a hard blow for farmers and for industry in Germany,” said André Vielstaedte, spokesman for Germany’s largest meatpacker and exporter Toennies.
African swine fever spreads through contact with infected animals and can also be spread by people and trucks. It is almost always fatal in pigs but does not harm people.
Germany has sought a limited, regional ban on exports as the outbreak near the Polish border is hundreds of kilometres from the major producing region in north-west Germany. Whereas the concept of a regional ban exists in intra-EU trade, China has so far stuck to a national ban.
German exports included large tonnages of pig parts such as ears, noses and feet which are regarded as delicacies in Asia but are unwanted in Europe.
Sellers will struggle to make similar margins on products normally sold to Asia.
“If supermarkets use this as an opportunity to keep prices low then the future of many pig farmers is in doubt and many could close,” said Matthias Quaing of German pig farmers’ association ISN.
COVID-19 has already made this is a difficult year with the virus causing major problems at meat plants.
The Toennies plant in Rheda-Wiedenbrueck closed in mid-June after about 1,500 workers tested positive.
“For Germany there are no real alternative pork export markets visible the size of China and others in Asia,” said Tim Koch, meat analyst at German independent market consultancy AMI.
“In the short term downward price pressure is likely in Germany after pig price falls on Friday,” he said.
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