China’s August Pork Imports Soar
Sharp drop in Chinese hog supplies will continue to force country to aggressively source protein from other countries
China’s August Pork Imports Soar +76% YoY
According to Chinese customs data, China's pork imports during August rose +76% from the same month in 2018 as the country continues to struggle with mortality rates of African swine fever (ASF).
Customs data showed that China imported 162,935 tonnes of pork during August, up 76% from August 2018 but down from July's 182,227 tonnes.
China's pork imports for the first eight months of the year were 1.16 million tonnes, up 40.4% from a year earlier.
China has the world's largest hog herd. Some estimates have the hog herd contracting by close to 40% as the disease has inflicted massive mortality rates throughout the country’s commercial and non-commercial hog herds.
Currently there is no vaccine for ASF and the disease continues to spread throughout Asia.
Beef imports are 130,619 tonnes, up 32%, bringing volumes for the first eight months to 980,334 tonnes, a 54% jump from a year ago.
Imports of chicken in August rose 51% to 67,074 tonnes, with total volumes so far this year at 483,743 tonnes, a 48% rise.
FBN’s Take On What It Means: We believe that the sharp drop in Chinese hog supplies will continue to force the country to aggressively source protein from other countries. While China has sporadically purchased pork from U.S. packers this year, we believe that material export opportunities could be available for the U.S. hog industry if China is able to resolve their trade differences with the U.S.
U.S. And Canadian Spring Wheat Hurt By Wet Harvest
Excessively wet conditions in the northern U.S. Plains and Canadian Prairies have hurt the quality of the region's spring and durum wheat crops.
Rains and excessive moisture have slowed the fall harvest to one of the slowest on record. USDA’s weekly crop progress report showed harvest 76% complete vs. the 5 year average of 93%. Harvest in North Dakota is 73% complete vs. the 5 year average of 91%.
Quality issues have developed throughout the growing region. These quality deficiencies include: scab, high vomitoxin levels and heavy test weights.
U.S. Wheat Associates is still reporting an above average protein for the crop.
FBN’s Take On What It Means: We believe that the quality issues can pressure local cash prices but it can also be supportive quality wheat. As the Minneapolis futures trade has rallied off its lows we recommend both U.S. and Canadian spring wheat producers contact their FBN farm market advisor, FMA, for guidance about where to make strategic crop sales.
The risk of trading futures, hedging, and speculating can be substantial. FBN BR LLC (NFA ID: 0508695)