News Article

Chinese Pork Imports Up 128 Percent

By Jan Hogewoning | Wed, 07/29/2020 - 09:13

In June, China imported 400,000 tons of pork, up 128 percent from the same month last year, Reuters reports. The outlet speaks of a month-long buying spree among importers to successfully meet domestic supply. The rise in imports has been going on for months, primarily because China’s domestic production was badly affected by the African swine virus in 2019 and early 2020. It was estimated that the virus wiped out 40 percent of China’s pig population in 2019. From January to June this year, pork imports have been up 142.7 percent at 2.12 million tons.

The increase in demand for foreign pork is good news for Mexican producers. China is currently the fastest-growing Mexican pork destination and after the US, it has become the second biggest destination for Mexican pork. In 2019, Mexican pork exports to the country grew by over 1,000 percent, reaching close to 30,000 tons. In March, Grupo Consultor de Mercados Agricolas (GCMA), predicted that exports this year could reach a level of between 60,000 to 80,000 tons. At the time, GCMA Director Juan Carlos Anaya pleaded with the government to approve more plants for export. Because of the COVID-19 outbreak, there were delays as officials from the Ministry of Agriculture and Rural Development and the national phytosanitary inspection agency SENASICA could not visit China to sign protocols for new plants. In late June, the National Council of Balanced Food Producers (CONAFAB) reported that there were currently 60 pork plants in Mexico certified to export to China.

Despite the good news, import growth is expected to slow in the coming months. The reason, Reuters states, is because Chinese customs have begun to test containers with frozen meat for SARS-CoV-2 traces. This will have a delaying effect on trade. In addition, imports contaminated with SARS-CoV-2 can be blocked. Already, supply from several countries was suspended due to COVID-19 outbreaks among workers. So far, Mexican producers have managed to avoid this. However, strict enforcement of sanitary protocols remains essential to protect trade.

While new outbreaks of the African swine virus were detected in China earlier this year, the Chinese domestic industry is expected to make a comeback eventually with investments in recovery already taking place, Mexico Business News reportedAccording to Reuters, one of China's biggest pork suppliers, New Hope, was expecting to make a recovery to pre-African Swine Virus levels by 2021. Nonetheless, the heavy demand for imported pork is expected to continue for the foreseeable future. The damage to the domestic Chinese pork industry and reduced supply led to a surge on pork meat prices in that country. The rise of living costs, a matter of concern for authorities in China, will ensure that importing pork will remain a priority. With the recovery of the Chinese hog industry, and many new players entering the market there, the price will fall again.

The data used in this article was sourced from:  
Reuters, Mexico Business News, GCMA, Porcicultura, The Guardian
Jan Hogewoning Jan Hogewoning Journalist and Industry Analyst