March 31, 2015

WH Group to increase pork deliveries to China this year

WH Group, which bought over US pork processor, Smithfield, in 2013, is attempting to meet pork demands in China by raising such imports from the US this year, according to the company's chairman, Wan Long.

"Our imports from the US, whether meat or by-products, will increase (as) US prices are low and Chinese prices are twice as high," Wan told Reuters.

However, he kept mum on the volume of imports that would arise from the 120,000 tonnes recorded in 2014.

Wan also added that pork consumption is challenged by the slow Chinese economy while industry observers noted of competing deliveries from Europe where a declining euro could make the region's pork a more economical option.

Nevertheless, WH Group will move ahead with the opening of four factories which process American-style meat products via Smithfield technology.

The first facility will commence operations in Zhengzhou, the capital of Henan province in east-central China, this year, producing up to 50 tonnes of bacon, ham and sausages daily in the early phase.

In 2014, a disease outbreak in the US had sparked a rise in pig prices, resulting in lower pork imports into China and thus a failure to meet previous expectations. The situation also worsened with strikes at ports in the American West Coast, bringing to a halt small shipments of chilled pork.

According to US data, total pork exports to China dropped 34% to 221,223 tonnes last year.