ASF disrupts feed demand in Philippines, Vietnam as Brazilian pork exports gain ground

The spread of African swine flu in Southeast Asia, particularly in Vietnam and the Philippines, has significantly reduced feed demand and these countries are increasingly importing livestock rather than raising them domestically, with market sources expecting that a return to normal feed demand may take some time.

"In the Philippines, vaccination efforts have proven largely ineffective, with approximately 68% of the hog population culled. The sector has relied heavily on direct swine imports. Consequently, many feed millers have shifted their production from swine feed to poultry feed, primarily for eggs, driven by strong demand. Overall, both demand and supply remain weak, with high prices persisting," said a Singapore-based grains trader.

The widespread outbreak of ASF in Vietnam has resulted in a high mortality rate among pigs, leading to a drop in the domestic meat supply. A local market source noted that this supply shortage has driven up meat prices, further exacerbating inflation.

The Vietnamese government has permitted the importation of frozen meat to stabilize the market.

"Furthermore, on March 31, the government issued a dispatch supporting meat imports, which is viewed as part of broader efforts to strengthen negotiations with the US, particularly concerning the Trump-era reciprocal tariffs," the source added.

Brazilian supplies step up

ASF has had a big impact on Asia's pork supply and since its early cases, Brazil has closely monitored the outbreaks worldwide for market opportunities, Geraldo Isoldi, agricultural markets analyst at King Korn, said.

"Vietnam's pork production has demonstrated remarkable consistency and self-sufficiency over the past decade, with production volumes steadily increasing until 2024," Iman Nur Salsabila, a Platts proteins analyst, said. "Although there was a notable spike in import volume from 2020 to 2021, it remains relatively low at just 4.89% of total consumption."

"In contrast, the Philippines experienced a 30% decline in production from 2019 to 2020, and imports have nearly doubled since that time to compensate for the low production. Pork production levels in the Philippines have remained weak and stagnant over the past four years, while imports accounted for approximately 33% of total consumption in 2024," Salsabila added.

"In 2015, Brazil's pork exports to the Philippines were just 612 metric tons. By 2023, the Philippines had become Brazil's second-largest pork market, importing over 217,000 mt, representing 18.4% of total exports — just behind China (18.6%)," Isoldi added.

The Philippines surpassed China as Brazil's top pork importer in late 2024, also emerging as a key market for Brazilian chicken and beef.

Brazilian pork supplies to the Philippines totaled 254,300 mt in 2024, up 101.8% year on year, while exports to Vietnam stood at 52,500 mt, up 9.7% on the year.

"As ASF continued to affect Southeast Asia, countries like the Philippines started to look for new suppliers, and from 2020, Brazilian pork exports to the Philippines began to grow," Hyberville Neto, director at Sao Paulo-based HN Agro, said.

"It is worth noting that by 2024, the Philippines had already lost 40% of its pig herd, and unlike China, the country has not been investing in farm infrastructure," Neto added.

Brazil supplied 27,000 mt of pork to the Philippines in March, its largest export destination for the month. The exports were up 85% compared to the corresponding month in 2024.

The Philippines' share in Brazil's total pork exports stood at 19% in nominal terms during the first quarter, making it the largest buyer. Vietnam's share stood at 2.7%.

"Brazil continues to benefit from the ASF outbreaks with Vietnam and the Philippines. It's still difficult to predict the impact of more recent ASF outbreaks on demand for Brazilian pork, but regardless of the reasons, exports should continue growing to these two countries," Isoldi said.

"This trend, which began five years ago, further strengthens Brazil's position as the world's largest supplier of animal protein," he added.

Platts, part of S&P Global Commodity Insights, assessed the price of pork belly CFR North Asia at $5,554/mt on April 30, up 3% since April 2.