China: Pork is scarce - 80% of imports from the EU

In the world's largest production area is scarce and expensive pork

The pig meat production in China is striking by 56.7 million tonnes estimated 53.5 million tonnes in the year 2016. is the ongoing decline of sow numbers from 50 million to now only 45 million animals. Although a part of the missing Piglet is through improved breeding performance and higher slaughter weights intercepted the meat fall, but the effort insufficient to cover the meat consumption in the country.

The basic causes for the decline of pigs in China are politically guaranteed high grain prices and the increasing intensification of environmental regulations. With corn prices over $35 per dt generation for most smaller pigs and sows holder was unprofitable. The stricter requirements in the handling of manure, drugs and animal carcasses is even mid-sized farms. In densely populated areas with high land prices, pig farmers had to abandon their site and relocate in less-intensive regions, if they had the capital to do so.

Now the Government has to announced to reduce the high price guarantees for crops with the aim to reduce the oversized inventories by more than 55% of a Chinese harvest significantly. Still little specifically named measures are showing in the autumn 2015.

High consumer prices at the same time not more so sharply rising incomes have prompted Chinese consumers to curtail pork consumption of 57.1 million tonnes in 2013 to 55.7 million tonnes in 2015.

The difference between production and consumption, as well as a small export to Japan and Hong Kong, an import demand of 1.3 million tonnesis calculated for 2016. Import demand on approximately 1 million tons can be calculated for the year 2015.

As in the previous years are import volumes are nearly 80% from the EU. Only a few U.S. pig farms can meet the conditions on the growth of Ractopamine refrain, which is not allowed in China.

But should take into account when assessing the growing EU deliveries to China, that the average export revenues only for € 1.40 / kg is located, i.e. There are mainly executed less valuable pieces of pork.

Chinese pork prices have moved in recent years to an average magnitude of €3 / kg . The conversion of Lebend-on carcass weight are not entirely unproblematic due to missing standards and slightly intensified slaughter yield. A distorting fluctuating exchange rates turned off by a fixed conversion factor of average 7 Yuan to €1.

Crucial for the profitability is the pork / corn price ratio, which was in the average of the last years at 6 to 1. With the announcement of falling Government price guarantees the corn prices are plummeted in the year 2015, so that in the 2nd half of 2015 an economic relationship by about 7-to-1 has emerged.

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