Rabobank results: pork industry set for global challenges

By Ashley Williams

- Last updated on GMT

The pork industry may be hit by the US China trade war over the coming months
The pork industry may be hit by the US China trade war over the coming months
The US trade dispute with China has been flagged as one of the main challenges that the pork industry is set to face in the coming months, according to the Rabobank Q2 Pork Quarterly results.

The Dutch banking group flagged up several factors that could affect the global pork industry, such as the US trade dispute with China causing margin pressures on pork, and disease risks affecting European, Asian and African markets.

Senior analyst for animal protein Christine McCracken said that with so many threats, agility would be a key asset for pork producers in a volatile operating environment.

The potential escalation of the China/US trade dispute – along with ongoing NAFTA modernisation talks – creates a heightened sense of risk​,” said McCracken. “Disease is also part of this uncertainty, including the threat of African swine fever (ASF) spreading in Europe​.”

With regards to the NAFA negotiations, McCracken added that plans to add production might be reconsidered until there was improved visibility.

Other problems outlined included steep hog prices in China declining by 30% year-on-year and announced tariffs on US pork unlikely to offset market pressures, while Brazilian producers continue to struggle with weak pork prices and higher feed costs.

Brazil’s Ministry of Agriculture, Livestock and Food Supply reported a 23.4% reduction in sales during March this year, due to a contraction in the quantity shipped and a 16.9% fall in price.

The threat of ASF overhangs the EU market and huge demand from China is not expected as a result of this.

Pork exporting opportunities were being explored last week as part of a two-day British meat trade mission to the Philippines​ to get a better understanding of the needs of the marketplace.

Related topics: Financial, United States, China, Pork

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