Industry analysts have predicted that international prices for pork may see a hike in the coming weeks as China continues to struggle with a swine virus outbreak. Experts said prices will soar in the Chinese market first.
According to Nikkei Asian Review, market experts are expecting to see pork prices go up in China as supply thins and demand heightens. The price hike will most likely affect global prices for pork as it is expected that China will rely on pork imports.
On Tuesday, multiple outlets reported that pork stocks started falling over the past few days and traders are preparing for prices to hit an all-time high. China's pig industry has been impacted seriously as African swine fever spread nationwide.
The Ministry of Agriculture and Rural Affairs revealed that 129 cases of African swine fever have been recorded so far. Industry experts said the situation could worsen. It was further forecasted that China could see the loss of around 200 million pigs until the epidemic is neutralized.
"Pork output will fall, and supply will be tight. The price of live hogs will hit new historical highs in the fourth quarter of this year," deputy chief of the veterinary bureau of the Chinese Ministry of Agriculture and Rural Affairs, Wang Junxun, said, as reported by the South China Morning Post.
Chinese hog farmers are reportedly starting to panic, with 80 percent making a choice not to restock swine in the meantime. Over a million hogs have been culled since the outbreak was reported in August.
Last month, China's swine herd production saw a significant drop of 21 percent, prompting fears in the pork industry. Aside from pork stocks thinning, it was predicted that demand for soybeans could slip as the product is a major animal feed ingredient.
Half of the world's pork supply is produced by China but over the past few months, the Asian country saw its biggest slump in swine numbers. Wang noted that experts have attributed the outbreak to inadequate bio-security practices in many small farms.
Wang pointed out that Chinese people are some of the world's largest pork eaters. Beijing is being pressured to ensure markets that supplies will be sufficient despite the African swine fever outbreak.
Brazilian exports of soy to China are expected to drop due to the swine fever epidemic, Brazil's agriculture minister, Tereza Cristina Dias said. She explained that the drop will most likely hurt demand for feeds from the country.
Dias is set to visit China in May to discuss soybean exports with Beijing since China is the world's largest importer of the feed commodity.
