November 8, 2019
US pork industry estimates pork imports from China to peak in 2022
According to the US pork industry report, global meat shippers have until 2022 to benefit from rising prices due to the pork supply shortfall in China, reported Reuters.
Pork prices around the world have risen to record highs as China, the world's biggest pork producer, is forced to turn to imports. The African swine fever (ASF) outbreak has depleted pork supplies in the country and pushed local prices for the meat upwards.
The US pork industry report, prepared by food consultancy Gina, indicated 2022 to be the peak of China's pork imports. Import volumes will maintain its high numbers up to 2025, but prices will steadily ease after 2022 as China's pork production progressively recovers from ASF.
The report noted that China is expected to recover from ASF by 2027, but production will likely be 13% lower compared to when the disease was first reported in 2018. Consumers' diet trends may also shift to other meats such as poultry in the long-term, which is significantly cheaper than pork.
Pork imports from China should return to 2017 / 2018 levels by 2040, the report added.
Rupert Claxton, meat director from Gira said the post-ASF market would be 80% of 2018 levels.
The US-China trade war has resulted in steep tariffs imposed on US companies, resulting in a sales disadvantage for US-based pork processors such as Seaboard Corp and Smithfield Foods (under WH Group Ltd).
However, Smithfield Foods have recently overhauled one of its US slaughterhouses to focus on exporting swine carcasses to China.
In a different report by Rabobank, US pork exports is expected to increase 14% in 2020 but pork production in China should begin to recover in 2021.