Covid-19: Impact on the global pig production sector

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US tops pork exporters to China despite dispute

The United States are benefiting from the phase one trade deal with China in terms of pork exports, despite an ongoing political dispute between the two nations.

Data from China Customs show that the country imported 1.68 million tonnes of pork in the first 5 months of 2020, which 156% more than a year earlier. The US was the biggest source of the imports, that stood at 333,445 tonnes, followed by Spain (300,136 tonnes) and Germany (239,637 tonnes).

The others among the top-10 pork exporting countries to China were Brazil (155,818 tonnes), Denmark (151,108 tonnes), Canada (134,015 tonnes), the Netherlands (126,208 tonnes), Chile (57,420 tonnes), France (48,634 tonnes) and UK (43,896 tonnes).

There were also 5 newcomers in the Chinese pork market, namely Argentina, Italy, Switzerland, Costa Rica and Belgium.

US full-year exports to China could hit 1 million tonnes

US pork exports to China saw a dramatic rise of 531% in the first 5 months, and in the same period of 2019, it ranked fifth among the major sources.

Dr Zhu Zengyong, chief analyst on meat trade under China’s agriculture ministry commented: “The US is benefiting the phase one trade deal with China, which could lift up its total pork and pork offal exports to about 1 million tonnes this year.”

Dr Zhu Zengyong. - Photo: Allen Shu
Dr Zhu Zengyong. - Photo: Allen Shu

US: Also the largest pork offal exporter

The US has also become the largest pork offal exporter to China this year, and the volume was 100,410 tonnes in January-May, or up 85% year-on-year. The US is motivated to expand pork exports with rising output, while its prices are quite competitive in the global market, according to Dr Zhu.

Canada, on the other hand, is losing its market share in China. Its rank in pork exports has fallen to sixth from third during the period, while pork offal exports declined by 32%.

Mexico records the highest growth in pork exports to China

Unlike the European countries that have a relatively stable ranking in pork exports to China, more countries in America are capturing the market aggressively. Mexico, a traditional pork importer in the world, reported the highest export growth in the 5 months of 2020. It shipped 34,439 tonnes of pork to China, up 1,360% from a year earlier and ranking eleventh among the suppliers.

The USA exported the most pork to China in the first 5 months of 2020. - Photo: Henk Riswick
The USA exported the most pork to China in the first 5 months of 2020. - Photo: Henk Riswick

“Even a net importer can export a lot after its production rose, and this also reflects that the Chinese market is quite profitable and attractive,” Dr Zhu said, adding that Argentina also has the potential to expand its exports.

As China’s pork output is rebounding and a tightened Covid-19 virus check is costing more of shipments, exports to China is seen to slow down in the second half of 2020, and a decline is expected from 2021, according to Dr Zhu.

China imports to peak while domestic production speeds up

In the first half of 2020, China’s pork imports totalled 2.12 million tonnes, exceeding the full-year record of 2.11 million tonnes in 2019. China’s agriculture ministry expects the country to import an extra 1 million tonnes of pork this year to guarantee the domestic supply.

The latest figures from the National Bureau of Statistics show that China produced 251 million pigs in the first 6 months, down 19.9% year-on-year, while pork output fell 19.1% to about 20 million tonnes.

China is rapidly rebuilding its pig herd, as can be read in this analysis

Recovery of China’s pig production speeding up

The authorities reiterated that recovery of China’s pig production is speeding up. The country had a pig herd of 340 million head at the end of June, up about 30 million head from the beginning of the year, according to the agriculture ministry. The herd was equivalent to 77% of that at end-2017, before China was hit by African Swine Fever in 2018. Meanwhile, the country’s breeding sows stood at 36.29 million head late June, including 5.49 million added in the 1st half. It was also equivalent to 81.2% of that at end-2017.

“The June herd of breeding sows rose 3.6% year-on-year, the first positive growth since April 2018 that indicates an important turnaround of China’s pig industry,” the ministry said in a statement.