The African swine fever epidemic that has blighted China's hog herds has created an opportunity for overseas suppliers to ramp up activity in the world's largest pork market.
Source: AP Photo
We report this week that U.S. pork producers have been at the head of the pack, selling more to China in the first eight months of 2019 than they did in all of the previous year.
U.S. companies have faced two major challenges in this endeavor. Escalating tariffs between the two countries have added costs, but that has been no deterrent. Between June and August, sales of U.S. pork to China surpassed pre-trade-war levels.
Another challenge is the use of animal feed additive ractopamine. Ractopamine stimulates the amount of lean meat in hogs and is approved by the U.S. FDA but banned in many other countries, including China. It is no coincidence that Tyson Foods on Oct. 18 joined the growing list of suppliers prohibiting the use of the substance in their pork.
This seems a wise move as the effects of African swine fever look set to persist for the foreseeable future. The U.S. Department of Agriculture's Foreign Agricultural Service expects China's hog herds to fall 40% by the end of 2020 from pre-outbreak levels. African swine fever may have been contained, but the ambitions of U.S. suppliers are anything but.
Consumer Edge is a weekly collection of critical developments across the automotive; retail; and food, beverage and tobacco industries. Drawing on exclusive analysis and value-added content from the Consumer News team at S&P Global Market Intelligence, it is published every Thursday. Click here to subscribe.
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