China’s Pork Imports Set to Plunge 50% as Local Prices Tumble
· Local prices have collapsed as hog herds rebound from disease
· Shrinking demand may bring some relief for global food costs
July 15, 2021
China’s record demand for foreign pork is about to crater after domestic prices plummeted, potentially easing pressure on the world meat market and cooling at least one constituent of global food costs.
The planet’s biggest importer of the protein staple could slash overseas purchases by more than 50% in the July-December period from the first half of the year because local supplies are now cheaper than overseas shipments, said Jim Huang, head of China-America Commodity Data Analytics, an independent consulting firm focused on agriculture.
Benchmark global hog futures have surged more than 25% in Chicago this year on strong demand and higher feed costs. By contrast, pork prices in China have slumped more than 50% on increased supplies as domestic herds rebound from African swine fever. U.S. pork is now more expensive than domestic meat after tariffs and freight, Huang said. This also means that the government can now replenish state reserves more cheaply on the local market.
The plunge in China’s demand for foreign pork could be welcome news for consumers elsewhere in the world. Rising prices of meat, grains and edible oils have helped boost global food costs this year to the highest level since 2011, igniting inflation fears, as the world struggles to emerge from the pandemic.
As an illustration of the increase in local supply, pork production in China jumped 36% in the first half of the year...
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