February 8, 2005

Pork consumption in Hong Kong up 7.6% in 2004

Pork consumption in Hong Kong increased 7.6 percent in 2004. Hong Kong banned chicken products from China and the United States in the early part of 2004, with the effect of pushing up pork consumption. The Hong Kong government has since limited the supply of live chickens to Hong Kong to 30,000 daily, which is about half of the normal import level. In addition, the catering industry has good prospects in 2005 with the bourgeoning tourism. Thus, pork consumption in 2005 is expected to be able to maintain the 2004 level at 480,000 MT.

US pork exports to Hong Kong reached a record in 2004. Between January-November 2004, Hong Kong imported 7,097 MT of pork, increasing 58 percent compared to the same period in 2003, with a value of $14 million. A weak US currency makes US products more attractive compared to products from European countries in terms of prices.

Chilled pork from China may start to come to Hong Kong in the first quarter of 2005. It will pose direct competition with freshly slaughtered pork. Once Hong Kong starts to import chilled pork from China, production of freshly slaughtered pork in Hong Kong is expected to decrease gradually over the years because of the existence of a price differential between the two types of pork.

Effective November 1, 2004, all meat re-exports to China through Hong Kong are subject to the compulsory pre-inspection required by China Inspection Co. in Hong Kong. The new measure incurs additional cost to Hong Kong traders, which amounts to approximately HK$4,000 per container inclusive of transport and pre-inspection fees. This additional cost may be big enough to drive more direct shipments from the US to China rather than transshipped or re-exported through Hong Kong.