Jim Long President – CEO Genesus Inc. firstname.lastname@example.org
Rabobank Recognises China’s Pork Import Potential
July 27, 2015
Last week Rabobank, the world’s largest Ag-Bank released their 3rd quarter perspective on Global Pork Markets. “The enormous cull” of China’s hog herd over the last 18 months is pressuring production, causing China to expand imports into 2016. Rabobank animal protein analyst Albert Vernooji says, “The main questions are when Chinese Import growth will start, how much volume growth there will be and what the support for pork prices will be across the globe.” Rabobank also says:
- China’s imports will expand second half of 2015 and into 2016.
- In the US, the question is if Q2’s margin recovery will continue, as the strong supply rebound will likely be partially absorbed by expected growth in exports to China.
- The EU market has ample opportunities for price and margin improvement.
- Continuing disease outbreaks in Mexico and South Korea support high prices and strong import demands.
ChinaWe agree with Rabobank about China’s import potential here and now. Three Key Numbers:
- China market hog inventory is 57 million lower than 2 years ago – down 2 million head a week.
- China sow inventory is down 10.3 million from two years ago.
- China market hog price is now $1.25 US live weight a pound. Mid-April it was 85₵ a pound US. That is a price increase of $100 per head.
Country of Origin LabellingSenate Agriculture Chairman Pat Roberts (R-Kansas) last Thursday offered an amendment to a highway-funding bill to repeal country of origin labelling requirements for beef, pork, and poultry and stave off trade retaliation from Canada and Mexico. A move hailed by NPPC – National Pork Producers Council. According to Iowa State University economist Dermot Hayes, the average US pork producer is expected to lose $10 per head beginning later this year and into next year, and based on these estimates retaliation from Canada and Mexico against US pork will likely double pork producer losses. Let’s hope the US senate supports Senator Robert’s amendment and business can get getting on.
Categorised in: Pork Commentary
This post was written by Genesus