EU, Canada, and US battle for China’s pork market, claims Rabobank

a173970a-17d8-42c4-8d60-7db958f08cefarticleimage.jpg

24 Jul 2017 --- Global pork trade is facing new dynamics, driven by price developments, new trade deals, and more challenging business environments, according to RaboResearch’s latest Global Pork Quarterly. “While China’s pork imports have begun to slow down, other traditional importing countries have reported significant growth,” says Chenjun Pan, RaboResearch Senior Analyst – Animal Protein. 

“Looking to the second half of 2017, global pork supply is expected to increase further, and competition for global consumers will intensify.” This potential softening bias on prices contrasts with the stability of the Rabobank Five-Nation Hog Price Index thus far in 2017. In the first five months of 2017, China’s pork imports were flat, which contrasts with the significant growth seen in 1H 2016. The recovery of local production and strong international prices is believed to be responsible for slower imports. In China, pork prices have declined by 30%, from the record levels of last year. As a result, Chinese traders are taking a more cautious approach to imports in 2017.

Rabobank holds the view that China’s pork production will increase by about 2% in 2017. Hog production recovery was faster than expected in 1H, as many producers shared a positive view of the market and made rapid herd replenishments. While the expansion of hog production should continue in 2H 2017, it has been slowed by the price plunge in Q2.

“The emergence of these new trade dynamics will be the most important market development in the second half of this year,” according to Justin Sherrard, RaboResearch Global Strategist – Animal Protein.

Other highlights from the Pork Quarterly Q3 2017 include:
EU: slower exports due to strong prices: Tight supply and firm demand have maintained upward pressure on prices and starting to challenge exporters. In this context, the recently announced trade pact with Japan, offering tariff reductions, is good news for European exporters.

US: uncertain outlook on political front and new plant capacity: US pork exports still face uncertainty due to potential trade policy changes and a strong currency, but have been better than expected thus far in 2017. With weaker demand from China offset by stronger demand from Mexico, total exports are expected to increase by about 10%, compared with 2016. Increasing US exports are becoming even more important as production continues to expand.

Brazil: political turmoil continues to impact: Brazil faces great challenges due to political turmoil, and exports in recent months have declined significantly. However, even with these challenges, Brazil’s pork market is still expected to deliver a positive result, due to lower supply, favorable feed prices, and a favorable exchange rate.

To contact our editorial team please email us at editorial@cnsmedia.com

Related Articles

Food Ingredients News

EU-Japan Economic Partnership Agreement: MEPs urged to ratify trade deal next month

14 Nov 2018 --- As the potential EU-Japan Economic Partnership Agreement (EPA) edges closer, Europe’s agri-food chain partners are joining forces to urge politicians to ratify the trade deal quickly. A number of trade bodies want EU producers to take full advantage of the new opportunities and tariff-free trading that would result from what would be the world’s largest open economic area.

Food Ingredients News

Top five AgTech start-up finalists shortlisted for Rabobank’s Food Loss Challenge

01 Nov 2018 --- Rabobank’s Food Loss Challenge Asia has declared its top five finalists of the inaugural Asia-based open innovation challenge aiming to identify innovative AgTech start-ups to help solve global farm-to-market food loss problems. The winner will be awarded at Rabobank’s annual Asia Food & Agribusiness advisory board meeting in Singapore later this month following pitches by the final five.

Food Ingredients News

Global Blockchain Technologies Corp CEO: “Blockchain’s ability to decentralize is relevant to everything on the face of the earth”

29 Oct 2018 --- Hyped as a potentially game-changing pioneering innovation, blockchain technology is inspiring change and innovation in the global food and beverage industry – and although it’s still in the extremely early stages, blockchain technology offers the promise of disruption on a huge scale across multiple sectors including agri-food, retail and the ingredients business at large.

Food Ingredients News

Export breakthrough: First Dutch veal en route to China after 17-year negotiations

17 Oct 2018 --- After more than 17 years of negotiation, the Chinese market is finally open to Dutch veal. Ekro, the subsidiary of the VanDrie Group, has become the first European veal slaughterhouse to receive approval to export veal products to China.

Food Ingredients News

At the forefront of food trends: Blending big business with disruptive start-ups to accelerate growth

16 Oct 2018 --- Start-ups are attracting the attention of senior executives (particularly in R&D roles) and large-scale corporations looking to collaborate. The industry is awash with examples of how big business is incorporating newly-established small companies that show such promise and scalability that investment from large-scale corporations becomes inevitable. So, is the future of food in the hands of disruptive startup and innovative R&D?

More Articles