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News 575 views last update:Oct 13, 2008

China's pork buyers visit US pork industry

Representatives of China's pork industry have arrived in Ohio to begin a week-long examination of US pork production and processing practices.

The 11-member delegation will visit Ohio, Indiana, Illinois and Iowa over the course of the week, with opportunities to gain firsthand insights on all aspects of the US pork industry. The tour was organised by the US Meat Export Federation (USMEF) and is co-hosted by the Ohio Soybean Council and the Iowa Pork Producers Association.

Leading export destination
China recently emerged as one of the leading destinations for US pork exports. Through the first seven months of this year, pork and pork variety meat exports to the China/Hong Kong region have increased by 288 percent in volume and 373 percent in value over the same period in 2007. With Jan.-July totals of 286,335 metric tonnes valued at about $497 million, China/Hong Kong is the largest export market by volume for US pork and pork variety meats in 2008, and the second-largest market (behind Japan) in value.

Market conditions, however, have become much less favourable in recent weeks. China has made a concerted effort to bolster its domestic pork production, resulting in significant herd expansion. These larger inventories have led to a decline in live hog prices – including a drop of approximately 15 percent in September alone. Piglet prices in the major hog-raising regions of China have dropped nearly 40 percent from their peak in the early spring. These factors are severely limiting market opportunities for US pork, especially muscle cuts.

“The first half of this year showed us the fantastic market potential that China holds for US pork, but current conditions show us that this is still a volatile and very price-sensitive market,” said Donald Song, USMEF's senior representative for north China. “The longer-term fundamentals point to a strong future for US pork exports to China, but success in this market will not come easily. Our marketing efforts will need to be more focused and efficient than ever.”

Increase understanding
According to Song, one of the keys to profitability and success in China is the development of positive relationships with meat buyers in the region. The team of pork industry representatives visiting the United States is looking not only to increase its understanding of the US pork industry, but also to develop contacts with producers and exporters. In Ohio, the group will receive an educational view of Ohio pork research and production, as the well as the opportunity to meet with representatives from many sectors of Ohio agriculture.

In addition to the Ohio Soybean Council, Merritt expects representatives of the Ohio Pork Producers Council, the Ohio Farm Bureau Federation and the Ohio Corn Marketing Program to participate. On Thursday the group travels to Indiana for a visit to the headquarters of Elanco Animal Health, for an overview of Elanco's worldwide contributions to improved swine health and performance.

The delegation will be in Chicago, Friday through Sunday, where highlights will include a visit to the Chicago Board of Trade and the opportunity to experience some of Chicago's most outstanding dining establishments. Monday, the group arrives in Des Moines for a “Meet the Buyers” conference in which they will meet with representatives of the Iowa Pork Producers Association, as well as leaders from other sectors of Iowa agriculture.

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