UK pork firms expect continued high sales in 2020 as ASF grips China

UK pork exporters are forecasting high demand from China to continue into 2020 after the country was hit particularly hard by African Swine Fever, which has been killing pigs around the world.

CNBC reported that Beijing authorities said on Monday that efforts to stabilise prices have achieved results. China has been drawing down on its frozen pork inventories as well as fast-tracking trade deals to raise the level of imports.

In the first eight months of 2019, Britain shipped more than 45,000 metric tons of pork to China, which was almost double 2018 volumes. This has made China the UK’s biggest customer of pig meat.

In the last few months, six new UK plants have approved to export pig trotters, a popular Chinese delicacy.

The UK’s biggest pork producer, Tulip, generates more than £1 billion in total sales each year. For China, Tulip primarily exports pig heads, trotters, hind feet and offal. Belly, back and shoulder are also shipped.

Tulip’s agricultural director Andrew Saunders told CNBC in an email Friday that its abattoirs that export to China have had an increase in sales of around 80% year-on-year.

Mr Saunders added that said Chinese demand growth had been happening since August 2018 and China had now witnessed a 25% reduction of its domestic pork production due to ASF.

On whether the high prices are likely to persist Saunders said: “We expect this to continue into 2020.”

In November, Cranswick reported a 7.1% rise in six-month sales “underpinned by a very strong performance in our Far East export markets”.

It added that ASF in Far East export markets had “created the opportunity to increase sales into this region on commercially favourable term.”

Chinese pork demand typically peaks in late January around the celebration of the Lunar New Year. Fears exist that China won’t have enough pig meat to satisfy demand next year.

But commodity specialists at Rabobank have seen signs that the Chinese consumer was prepared to avoid pork if the prices were too high.

It said in June that Chinese pork consumption had dropped by 10% to 15% across 2019, driven by food safety concerns.

It noted that while lowering pork consumption and the release of healthy frozen pork had restricted rises to Chinese pork and hog prices, other substitute meats prices were on the rise.

Rabobank said Chinese canteens at schools or factories had switched to poultry and chicken breast meat prices had risen by 44% year on year by May. The bank forecasts that for 2020, there will be less pork produced but other markets such as beef and chicken will grow.

Get Our E-Newsletter - Pig World's best stories in your in-box twice a week
Will be used in accordance with our Privacy Policy
Share.

About The Author