Uncertainty remains for China's imports of Canadian, US pork

By Zhang Hongpei Source:Global Times Published: 2019/5/19 20:53:40

Canada has taken advantage of China's imposition of tariffs on US pork to boost its own exports to China, but that won't last long as China, the world's biggest pork consumer, could further reduce its imports from both North American countries amid escalating trade rows.

With Chinese tariffs on American pork still in place, Canada is importing more from the US and shipping its own produce to China, Bloomberg reported Friday. Citing data from relevant departments, the report noted that Canadian pork exports to China soared 80 percent year-on-year in March to 33,456 metric tons.

The report contributed the increase to the African swine fever (ASF) epidemic in China, which has affected domestic supply and pushed up pork prices.

However, the uptrend for Canada faces large uncertainty and may encounter setbacks in the future as the China-Canada diplomatic dispute over the arrest of Huawei senior executive Meng Wanzhou is still ongoing, said analysts.

China suspended pork imports from two Canadian companies - Olymel LP and Drummond Export - in early May, media reports said. This restriction followed Chinese authorities' suspension of three major Canadian canola seed exporters' licenses, citing non-compliance with China's health requirements.

"Pork produced in Canada or exported via Canada, which is actually from the US, is likely to face pressure under the current circumstances," said Jiao Shanwei, editor-in-chief of cngrain.com.

Jiao told the Global Times Sunday that it seems China is in sore need of imported pork to supplement its own falling supply due to ASF, but it also appears that pork consumption is being restructured in China.

The numerous outbreaks of ASF throughout the country have not only caused a sharp drop in domestic herds but have also greatly dampened pork consumption in China, according to Angela Zhang, head of the Business Intelligence Division at Shanghai-based IQC Insights.

China's sow herd in April fell 22.3 percent compared with the previous year, data from the Ministry of Agriculture and Rural Affairs showed.

"Even if US-origin pork heads to China via a third country, it's not Canada's turn. Mexico is a better alternative based on its frequent trade with the US in pork and its normal relationship with China," said Feng Yonghui, chief analyst at hog market information provider soozhu.com. 

Chinese buyers dropped orders for 3,247 metric tons of US pork, the biggest cancellation in more than a year, Reuters reported Friday, citing data from the US Department of Agriculture released on Thursday.

The cancellation came during the week ended May 9, a blow to the $6.5 billion export market for American pork, said the report.

China is showing less interest in buying US pork due to the ongoing trade war. The country has been importing more from such sources as the EU, Feng told the Global Times on Sunday.

In 2018, China's imports of US pork more than halved to about 263,000 tons, data from the General Administration of Customs showed in January.



Posted in: ECONOMY

blog comments powered by Disqus