In this file:
· Weekly protein digest: China's meat imports expected to fall in 2021
… imports are expected to fall as producers rebuild swine herds and production rebounds…
· Alarm sounded over China’s dominant position in global meat trade
… It is the dominant player in pork, it is going to represent close to 40% of global pork trade in 2020; it has become the dominant importer of beef, with around one quarter of all beef imports…
Weekly protein digest: China's meat imports expected to fall in 2021
Jim Wyckoff, Commentary, The Cattle Site
16 October 2020
Jim Wyckoff's latest beef and dairy industry updates track China's import future and the international dairy market.
Beef industry news from China
Chinese meat imports remain strong this fall
China imported 834,000 metric tonnes (MT) of meat during September, a slight increase from August, according to preliminary customs data. So far this year, China has imported 7.41 MMT of meat, a 72 percent surge from year-ago.
Beef imports likely totalled 180,000 MT in September, pushing the nine-month tally to 1.57 MMT, a 38.8 percent jump for the year.
China seen pulling back on meat imports in 2021
USDA this week reported global meat imports will decline marginally in 2021 as softening demand from China offsets gains elsewhere. China meat imports are forecast to set records in 2020 due to a sharp decline in pork production from African swine fever (ASF). Next year, imports are expected to fall as producers rebuild swine herds and production rebounds. Outside of China, global meat imports are largely rebounding as economies bounce back from COVID-19 and as food service demand improves.
China beef imports are forecast 4 percent higher at 2.9 million tons in 2021– another record high. Evolving tastes and relatively modest production growth are expected to support beef imports next year. However, rebounding pork production will slow growth in beef imports to the slowest pace in more than 5 years.
USDA issues annual China feed use report
China’s 2020/21 feed and residual use for all coarse grains and feed-quality wheat are estimated to increase 3.2 percent compared to the previous marketing year due to a projected recovery of swine production and strong expansion in the poultry and ruminant sectors.
Though typhoons caused heavy damage and extensive lodging in the major corn producing north-eastern provinces, the impact on overall production will be limited as storms hit only weeks before harvest and will not result in a total loss.
In addition, Fall army worm (FAW) impact is less than anticipated resulting in a total decrease in corn production of only 4 percent. While China may rely more on corn imports in the coming marketing year, some of these gains will be mitigated by an increased use of sorghum, barley, and old rice and wheat stocks in feed rations to take the place of record high-priced corn…
Alarm sounded over China’s dominant position in global meat trade
By Jane Byrne, Feed Navigator
China has become the biggest player in animal protein trade globally, and there should be concern about the implications, politically and economically, of such strong market dominance, says an analyst.
“China’s share of beef, chicken and pork trade is going to grow more strongly than we had anticipated. It is the dominant player in pork, it is going to represent close to 40% of global pork trade in 2020; it has become the dominant importer of beef, with around one quarter of all beef imports, and although it is not the largest importer of chicken meats, it is certainly in the top few, along with Japan, the UK and Europe, etc. But when you put all of that together, it paints a picture of strong market dominance.
“To date, China has only used that dominance for tactical reasons, to put downward pressure on price. The question in my mind is when China starts using that dominance in trade for other political reasons as well. And we may see that starting to emerge as China picks winners or pushes others to the side as suits its political as well as its economic agenda,” said Justin Sherrard, global strategist, animal protein, Rabobank.
He was presenting, as part of a Hamlet Protein hosted webinar yesterday [October 15], on the opportunities and risks arising out of the COVID-19 crisis for the global pork industry.
Herd recovery in China
Sherrard also tempered the more optimistic outlook being presented in some quarters about swine sector recovery in China.
“We think China’s production will be up by around 10-12% in 2021, on 2020 levels, still a long way down on where it was in 2017-2018, when it was over 54m tons; next year, it should get to around 39m tons, still a long way down on those earlier levels, but starting on the road to recovery,” said the animal protein market strategist.
Full recovery of the swine herd will likely be in 2024 or 2025, he said.
There is, however, great confidence on the part of the larger pig farmers in China that they can deal with biosecurity issues – an indicator of that confidence is the high level of breeding stock imports into China, up on 2019 levels, with continued growth seen in the third quarter of this year.
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