September 8, 2004

 

 

Beef, Pork Consumption Seen Increasing In China

 

China's consumption of beef and pork is forecast to continue climbing due to strong growth in per capita income, according to the U.S. Department of Agriculture.

 

Cattle and Beef Market Summary

 

Since December 25, 2003, China has banned U.S. imports of bovine and bovine products due to the one case of bovine spongiform encephalopathy in the United States. It is still unclear when China will lift the bans.

 

USDA provided Chinese officials with information about the U.S. mitigation measures on BSE during 2004. A Chinese BSE technical team also visited the United States in September 2004. China is reviewing this information as part of its own risk assessment process.

 

The Chinese Government would revise its domestic law if China's BSE concerns on U.S. bovine products were lessened. This is a lengthy procedure which involves the Ministry of Agriculture, the General Administration of Quality Supervision Inspection and Quarantine (AQSIQ), the Ministry of Health, the State Food and Drug Administration and ultimately the State Council.

 

FAS Beijing forecasts that bovine serum, embryos and protein-free tallow- products deemed as non-risk under the OIE guidelines-will be the first products permitted entry.

 

Live cattle imports during 2005 are forecast to increase sharply from 55,000 head to 60,000 head. It is an increase of 50% driven by the continued prosperity of the dairy sector. Australia and New Zealand are the dominant suppliers.

 

China's beef production for 2005 is forecast at 7.1 million metric tons, a 6% increase from this year due to continued strong beef demand and rising incomes. Live cattle imports for 2005 are forecast to increase 50% from 100,000 to 150,000 head, steered by China's surging dairy industry as well as the need for better genetics by both the dairy and beef cattle sectors.

 

Beef imports in 2005 are forecast at only 15,000 MT. This is a significant decline from the previous high of 27,000 MT in 2003, due to China's continued ban on U.S. and Canadian beef in addition to higher international beef prices. China's beef exports are forecast to increase from 40,000 MT to 45,000 MT because of increased demand in Hong Kong.

 

Swine and Pork Market Summary

 

Pork production for 2005 is forecast to increase from 47 million MT to 49 million MT. Farmers continue to increase pork production because of strong consumer demand urged on by China's rising incomes.

 

Pork imports in 2005 are forecast at 88,000 MT, a decline from 2004 as a result of increased domestic supplies. Exports during 2005 are forecast to increase from 357,000 MT to 450,000 MT due to strong demand from Hong Kong, North Korea and Japan. China lost export share to Russia because of its quota import quota limit. However this loss will be compensated by export gains in the other markets.

 

China recently announced a new import meat quarantine regulation. As of Nov. 1, 2004, all meat and poultry products re-exported through Hong Kong must be pre-inspected by the China Inspection Company based in Hong Kong before entering the mainland. The new law aims to reduce the smuggling of products.

 

The new regulation could potentially benefit U.S. meat because non-U.S. meat often enters China in US carton boxes accompanied by a false U.S. export certificate after repackaging in Hong Kong. The new inspection policy could also lead to more direct imports into Mainland China.