China’s pork imports will fall in 2017 from this year’s record highs, thanks to the boost that revived prices of the meat have given to domestic farmers to increase their hog herds.
The US Department of Agriculture’s Beijing bureau, in its first forecast for Chinese pork dynamics next year, pegged imports at 2.2m tonnes.
Imports at this level would be down 200,000 tonnes from 2016 imports the bureau pegs at a record high of 2.4m tonnes.
However, it would still represent a historically high figure by China, the top pork consumer and producer, as well as importer.
‘Slow down dramatically’
China’s recovering hog prices – which in June stood at 20.58 per kilogramme, up 38% year on year – has encouraged producers to rebuild herds, which is forecast growing in 2017 for the first time in four years.
“Led by large-scale producers utilising recent profits, sow stocks began expansion in late 2016 and are expected to continue to grow next year,” the bureau said in a report.
It forecast swine ending inventories ending next year at around 425.2m head, reflecting a 1% herd expansion during the year.
And growth might have been more marked were it not for environmental laws, which have curtailed farmers’ ability to expand, recent flooding in the south of the country, and the outbreak in February of porcine epidemic diahorrea virus, (PEDv), a disease which two years ago caused such losses to the US herd.
This increased supply is likely to result in the decline of pork prices by mid-to-late 2017, which will encourage producers to slaughter animals – with a corresponding increase in pork production.
Indeed, while Chinese consumption of pork will rise by 1.7m tonnes to 55.8m tonnes next year, the increase will be more than offset by growth in output of 1.9m tonnes.
“Imports are expected to remain firm in early 2017 but then slow down dramatically later in the year,” the report said.
US shipments to decline
Currently, imports from the EU – led by Germany, Spain and Denmark – comprise nearly 70% of China’s pork purchases.
Although lower US pork prices are anticipated this year, shipments will remain constrained by China’s curbs on supplies obtained from industries which use the growth promoter ractopamine.
The relatively strong US dollar was also viewed as a disincentive for imports.
(Source – http://www.agrimoney.com/news/chinas-pork-imports-to-ease-from-record-as-domestic-output-grows–10036.html)