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Two different crisis are shaking the global meat market

Pork

COVID-19 Overshadows ASF, but ASF’s Influence Prevails - argues Rabobank analyst.

Posted on Jun 23 ,11:42

Two different crisis are shaking the global meat market

Amid COVID-19 crisis, seems almost everyone forgotten that the global meat industry has to resurface from another crisis that changes the global trade landscape. The ongoing ASF crisis in Asia is far from over and the damage expected this year is going to be far worst than what we have witnessed in 2019, warns a new Rabobank report.
"Herd recovery is underway in China, and has been proceeding faster than expected, but a further significant drop in pork production is expected in 2020. The ASF situation is stabilizing in Vietnam, but further reductions in 2020 production are expected. Meanwhile, in the Philippines, the disease continues to spread. As such, China and Southeast Asia will continue to increase pork imports, with the expectation that China’s pork imports will reach record levels,", said Rabobank's report.
The estimates for China's pig herd losses in 2019 are ranging from 35% to 40%, which is very close to 20% of the global pig inventory. Besides that, the disease is present not only in Asia but also in Europe, where outbreaks are reported constantly in Ukraine, Bulgaria, Romania or Poland.
Combined with the complications added by the COVID-19crisis in processing plants from Germany, Spain, Italy, United States, Canada and Brazil, the ASF virus represents one of the largest threats to the stability of the global food market.
Analysts were expected increased production of pork in North America, Brazil and several parts of Europe but the impact of COVID-19 has erased most of those expectations.
"The main uncertainties we see in global pork markets, associated with ASF and influenced by Covid-19, are: the loss of production associated with processing plant closures and slowing of operations; the possibility that ongoing geopolitical tensions between the US and China will affect pork trade; and the risk of an ASF outbreak in a major producing country in Europe, such as Germany," commented Justin Sherrard, RaboResearch Animal Protein Strategist.
COVID-19 will also affect pork consumption due to the closure of foodservice and high prices appeared in the light of new security measures imposed for processors.

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