<img alt="" src="https://secure.item0self.com/192027.png" style="display:none;"> Top Stories

China’s self-sufficiency target for pork and fundamentals to support global feed grain prices

October 23, 2020

1 mins read

China has been importing large volumes of pork since the outbreak of African Swine Fever (ASF) in the country in August 2018. More than half of the pig population has been decimated due to the disease. China has recently announced its aim to produce 95% of its pig meat demand domestically, achieved through a rapid rebuilding of its pig herd following the ASF epidemic. Nevertheless, no timeframe was notified for achieving this target. Pre-ASF, China averaged at around 99% self-sufficiency for pork.

The rebuilding activity is likely to support the global feed grain demand. China has seen surging imports of feed grains such as maize, wheat and soybean from countries like the US and Brazil. As a result, grain prices have shown an upward trajectory. Mintec maize and wheat prices in the US increased by 30% and 26% respectively, between August and the third week of October. Mintec soyabean prices in Brazil were also up 30% y-o-y in the week ending 21st October.

Coupled with an increase in demand from China, fundamentals have been the underlying drivers behind the recent surge in feed grain prices. According to September estimates, the US maize production is forecast at 378.5m tonnes in 2020/21, down from the 406.2m tonnes estimate in June, due to persistent hot and dry weather during Spring, and severe storms over the Summer across the Corn Belt. Similarly, US 2020/21 wheat production is projected to fall by 4.3% y-o-y, to 50m tonnes, and down 7% from the five-year average, on the back of higher than average precipitation leading to the smallest winter wheat planted area in more than a decade. Overall, Chinese pig rebuilding activity and global grain fundamentals are likely to add upward pressure to the global feed grain prices.

Topics: Meat & poultry
Rutika Ghodekar
Rutika Ghodekar

/You May Also Like

Featured Image
  Exchange-traded cocoa prices have been on a wild upswing, rising...
Featured Image
The pandemic has had a significant impact on the nuts market from...