February 6, 2012

China's pork imports likely to slow in 2012

China's 2012 pork imports are likely to slow down after an 80-90% increase in 2011, Rabobank Group said on Wednesday (Jan 1).

Domestic production is regaining its footing, resulting in lower prices and reducing the need for imports, the bank said in a note to investors. Rabobank did not forecast a percentage decline in imports of pork meat, but estimated that imports of pork and offal will be around 18%-35% lower this year compared with 2011.

Disease outbreaks continue to threaten supply, with clear signs of foot-and-mouth disease among Chinese hogs, said the analyst team led by David Nelson.

However, China's hog numbers had begun to recover in spring 2011 and reached about 475 million heads in November, about 5% more than at end-2010 and 2% more than the end-2009 count, it said.

"Rabobank expects the hog herd will continue to expand, but the pace will slow in 2012," it note said.

Post-Lunar New Year sluggishness in prices may persist until the third quarter, it said. China imported about 360,000-380,000 tonnes of pork in 2011, the bank said. The US was the largest beneficiary of the sharp rise, with direct exports to China rising fivefold to 200,000 tonnes, it said.