China releases pork stock to expand supply

According to Reuters, the Chinese Ministry of Commerce reported on Thursday (08/28), that China will seek to increase pork imports as well as frozen pork, beef, and mutton from state stock in “due time” to increase market supply.

The comments came as pork prices in the world’s largest beef consumer hit a record high after an African swine fever epidemic swept through the nation’s herd, killing millions of animals.

The country’s pig herd has shrunk by almost a third from last year, according to official data, and pork prices have soared since June.

Meat imports have already increased by 36% in the first seven months of this year, and analysts expect them to double from 2018 levels by 2020.

“We will continue […] encouraging the expansion of pork imports,” ministry spokesman Gao Feng told reporters.

China has agreed to start importing pork from Argentina this year and may also approve additional plants for export from Brazil and Great Britain.

With the problem in China, demand for meat from Brazil is growing, with the sector talking about “perfect bonanza”, and other positive factors influencing business. But the Brazilian industry still awaits the release of more units for export.

Gao also said China would release meat from its reserves to stabilize stocks.

China often releases some of its stored meat when prices are high or during periods of high demand, such as the weeks following the Lunar New Year holiday, the country’s biggest festival.

The government of China released 9,600 tons of pork from stock in January, according to state media reports. But while the total volumes held by the country are not known, analysts say they are unlikely to be significant enough to have a real influence on market stocks.

“The government wants to support the market, but that’s another political gesture,” said Pan Chenjun, senior analyst at Rabobank.

Retail pork prices jumped 7.8% in the week up to August 14, reaching RMB 32.4 per kilo, according to Ministry of Agriculture and Rural Affairs data, up almost 50% from the same period of last year.

China’s cabinet called for measures to support the recovery of production.

Source: Reuters

Sharing is caring!