Chinese pig disease could impact trade talks

Operations at the Tianjin Tianjiao Group hog feed producer. (Bloomberg pic)

NEW YORK: African Swine Fever, which is currently spreading through northeastern China, has the potential to impact trade talks down the road if outbreaks of the deadly disease become widespread, according to Brett Stuart, founding partner of Global AgriTrends, a market intelligence firm focused on global agriculture.

It isn’t possible to predict with any certainty how the disease will spread -— there could be sporadic outbreaks with an insignificant national effect. But the density of hogs and the scale at which they are raised in China creates a serious risk, Stuart said. A widespread outbreak could lead to mass culling of hogs, and since imports represent about 3% of China’s pork consumption, even a 10% cull would have significant impacts on import needs.

China is the world’s biggest pork producer, consumer and importer. It boosted tariffs on US pork to 37% in April and then to 62% in July.

“It’s not like they need the U.S.,” Stuart says, noting that the European Union is a bigger exporter, supplying about 55% of the Chinese market, so the potential impact from the disease on trade talks wouldn’t be immediate. “But when you look at potential, it could get to a scenario where they consider lifting the duties.”