ASF: China likely to require more pig and meat imports

Biosecurity remains a challenge for much of the Chinese industry. In light of this, expectations are that production will fall somewhat, boosting import demand for pig, as well as other meat, products, concluded the AHDB analysts.

“African Swine Fever is set to be an important topic in the global pork market this year, with the level of spread determining global trade flows and import demand,” ​they added.​

Since the first report in August, African Swine Fever (ASF) has continued to spread in China, with now over 100 cases recorded from 23 provinces. 

Biosecurity ​

The majority of ASF cases have hit small producers with poorer biosecurity, although recently a herd of 74,000 head was also affected, noted the analysts.

“Several hundred thousand pigs have died of the disease or been culled, though with a pig population of over 400 million head, this is yet to make any material dent in swine stocks.​

“Despite this, the Chinese pig industry has still been significantly disrupted. Provinces where there are active outbreaks, and those surrounding, are subject to restrictions on live transport. ​

“This is particularly problematic as during the industry’s recent modernization program, many pig farms were relocated to remote Northern areas. However, most abattoirs are situated in the south near more populous areas, necessitating long-distance transport to slaughter.​

“The transport restrictions have split the market in two, with areas of surplus in the North while key demand areas in the South suffer supply shortages.” ​

Reports indicate pork prices have become similarly polarized, said the market specialists.

Easing of some transport bans​

The Chinese government has recently tried to alleviate this situation by easing some conditions of the pig transport bans, they added.

One aspect of this is that finisher pigs produced at farms with high biosecurity levels in ASF infected counties can now be sold to slaughterhouses processing at least 150,000 pigs per year. Sows and piglets from counties without ASF within the infected province can also now be moved.

“The impact of these changes remains to be seen.”​

Consolidation trend

In October 2018, Rabobank outlined how China’s hog industry is fragmented, with 40% of hogs coming from small producers:

"Biosecurity has been a weakness of this segment, and most reported cases of ASF come from farms with fewer than 500 hogs, commonly using kitchen waste to feed hogs. Conversely, large-scale farms have very strict biosecurity, with standardized feed and have, so far, largely been unaffected by ASF. We expect ASF to catalyze widespread industry consolidation, with many small farmers becoming uncompetitive under the new market conditions.”​

Contaminated feed report

Meanwhile, Reuters reported late December that China had detected the ASF virus in protein powders derived from pork blood and manufactured by a Tianjin-based company.

The incident occurred despite the fact that, in September, China had banned the use of food waste and pig blood as a raw material in the production of feed for pigs, in a bid to halt the spread of ASF, noted Reuters​.

China’s General Administration of Customs released a statement confirming the find.

The protein products were said to be produced by a subsidiary of Tianjin Baodi Agri & Tech Co Ltd. The raw material for the 73.93 tons of contaminated protein products, mainly used in animal feed, came from 12 slaughterhouses in Tianjin, claimed the administration.

The customs administration also reportedly issued an alert, valid for six months, to strengthen testing for the virus in exports of such products and warned farms in Hong Kong and Macau to tighten their checks on animal feed imports.