January 14, 2010

Meat demand in Asia is yet to reach its potential

Asia's meat producers require stricter management, stronger genetics and new technologies to propel growth.

Meat demand has risen more dramatically across Asia than any other region over the last 20 years. Despite poultry being Asia's fastest growing meat sector, pork remains the number one meat in countries such as China, Vietnam, the Philippines and South Korea. As a mainstay of local cuisine and a familiar meat, pork consumption can be expected to grow further with rising affluence.

From under 10kg per person in the early-1990s, annual consumption of pork has soared as much as 40kg in China and Taiwan. Across Asia, production growth has been driven primarily by China as well as Vietnam, which more than doubled its output between 2000 and 2009. Over that period, China's production volume rose by some 25%. Asia's pork industry is domestic-driven with very little export as production has been directed mainly towards meeting local consumption.

With the exception of Japan and South Korea, imports by Asian countries are minute in relation to domestic pork supply. Pork imports typically account for almost half of domestic consumption in Japan and 33% in South Korea.

Fresh pork is still very much in demand among Asians who frequent traditional markets where pork, freshly slaughtered and hung on metal hooks, is sold with minimal packaging or cold storage facilities. Nevertheless, the rise of supermarket chains is shaping consumer demands for food safety and the evolution of the pork supply value chain.

Asia's pork sector will inevitably be dominated by the Chinese market. China's pork industry is the world's biggest pork consumer. Production has increased steadily to keep up with demand.

By 2015, the projected pork demand is estimated at 68 million tonnes, an increase of 45% from 2009 levels or 6.5% in compounded annualised growth. Although the share of pork in China's livestock production profile has been declining, pork continues to be the most popular meat at about 70% of total meat consumption, roughly the same level as in Vietnam.