African Swine Fever (ASF) continues to roil protein markets in Asia, especially China, and other parts of the world. The disease continues to spread and impacts are growing and very dynamic in nature. However, the latest data from USDA Foreign Agricultural Service (USDA-FAS) shows that the pattern of impacts on global protein markets is beginning to be revealed. No doubt numbers will change with more time.
The epicenter of ASF is China which, as recently as 2018, produced nearly half (47.8 percent) of world pork production. Estimates of hog losses since 2018 due to ASF in China range widely but most put the number at more than half of total hogs with some estimates up to 70-80 percent hog mortality.
As ASF impacts grew from initial reports in August 2018 to now, pork production in China is projected to decrease 14.0 percent in 2019 from 2018 levels with another 25.3 percent drop year over year in 2020. That implies a 35.7 percent decrease in Chinese pork production in two years. This contributes to a 15.7 percent decrease in global pork production from 2018 to 2020. The losses in China may well exceed these estimates.
In 2018, pork consumption accounted for 74 percent of total Chinese beef, pork and poultry consumption. The losses to ASF are creating a major protein deficit in China that is impacting all protein markets globally as China attempts to mitigate reduced meat supplies. Total Chinese consumption of pork, poultry and beef is projected to decrease by 14.9 percent from 2018 to 2020; with pork dropping to a 59.8 percent share of total meat consumption.
Pork imports are projected to increase 66.6 percent in 2019 over 2018 and another 34.6 percent year over year in 2020. Global pork imports are expected to grow 13.5 percent year over year in 2019 and another 11.0 percent in 2020 as China’s share of global pork imports grows from 19.7 percent in 2018 to 35.1 percent in 2020. Global pork exports are expected to grow 11.3 percent year over year in 2019 and another 10.4 percent in 2020. The U.S. began to see direct impacts of this with a 479 percent jump in pork exports to China in July and August.
China is looking to other proteins as well. Chinese imports of poultry meat are projected to increase 82.7 percent year over year in 2019 and another 20 percent in 2020 leading to a two-year increase of 119.3 percent in poultry meat imports in China. China’s share of global poultry imports will increase from 3.7 percent in 2018 to 7.3 percent in 2020. World poultry meat exports in 2019 are projected to increase 6.1 percent year over year and another 4.4 percent in 2020.
Beef imports to augment protein supplies in China will add to the rapid pace of beef import growth in China since 2013. Chinese beef imports are expected to increase 63.6 percent year over year in 2019 and another 20.8 next year. China’s share of global beef imports is projected to be 30.0 percent in 2020, up from 8.6 percent as recently as 2015. Total world beef exports are projected to grow 4.3 percent in 2019 over 2018 and another 4.4 percent year over year in 2020.
In total, global production of beef, pork and poultry is projected to decline by 1.5 percent year over year in 2019 and decrease another 2.4 percent in 2020 as a result of decreased pork production due to ASF. At the same time, global meat exports are expected to increase 6.9 percent in 2019 compared to 2018 and to grow another 6.1 percent in 2020.
As a result, global meat exports are projected to expand from 11.2 percent of total production to 13.2 percent in just two years. ASF is not controlled in most countries where it is currently active; is difficult to eradicate; and restocking is usually unsuccessful if the disease is not completely controlled. The rebuilding of the global pork industry is not a matter of months but rather will take years. It is clear that ASF will have very significant impacts on global protein markets for the foreseeable future.