China Hog Update: Official Earthquake Loss Numbers Increased
China Hog Update: Official Earthquake Loss Numbers Increased
China has more than doubled its estimate for hog losses attributable to the Sichuan earthquake, from 1.52 million head to 3.658 million head, including 184,500 sows. Analysts now expect 2008 provincial pork production to drop approximately 9 percent (700,000 metric tons) from 2007 levels, and live hog inventories to decline by 10 million head. Such a loss would equal 1.6 percent of national pork production, and 2.2 percent of national hog inventories.
More details have emerged about specific damage to large meat processing enterprises such as integrator New Hope Group, and Sichuan Gao Jin Food Company, one of China's largest meat processors. Both say that the earthquake has led to major losses and dislocations in production infrastructure, according to an exclusive eFeedLink report on the earthquake's impact on Chinese agriculture. The report states that hog farmers are selling off inventories due to continuing difficulties in transportation infrastructure, contributing to an average drop in Sichuan live hog prices from the pre-quake price of $110/cwt. to $96/cwt. The report concludes that the quake should not greatly impact national market dynamics this year, and China Meat Association analysts recently stated that pork production in China is on track to increase by 2 percent to 3 percent for the year. This potential increase, however, would still put Chinese pork production at 5 million metric tons less than the peak production in 2005, at more than 50 million metric tons.
USMEF-Hong Kong and Guangzhou report that Sichuan traditionally supplies boxed frozen pork to South China and Hong Kong. Hong Kong analysts were quoted yesterday estimating that frozen pork supplies from China would decline by 500 metric tons per month due to the quake. Hong Kong has imported a monthly average of 37,000 metric tons of pork from all sources in the first four months of 2008.
In other news, China announced that from next Friday it would scrap export rebates on 36 types of vegetable oil products. The market impact is expected to be largely psychological since the country's 166,000 tons of oil exports last year accounted for a fraction of total consumption. China’s soybean imports have surged 115 percent in value, to $5.8 billion, with a 21.5 percent increase in volume during the Jan-April period this year. Imports from the U.S. totaled $4.25 billion with the remainder coming from Argentina and Brazil.
Animal Health
Ten Brazilian States Recover FMD-Free Status
The World Organization for Animal Health (OIE) has restored 10 Brazilian states and the federal district to the status of an "FMD free zone with vaccination." According to the OIE Web site:
“The Scientific Commission for Animal Diseases evaluated the documentation concerning the control of foot and mouth disease in Brazil following outbreaks of FMD in two zones... The Scientific Commission … recognized that as from 24 May 2008 zone 1 (the States of Bahia, Espírito Santo, Minas Gerais, Rio de Janeiro, Sergipe, Tocantins) and zone 2 (the States of Distrito Federal, Goiás, Mato Grosso, Paraná, São Paulo) of Brazil have regained their FMD-free status practicing vaccination.”
Five of the states — Minas Gerais, Goiás, Mato Grosso, Paraná and São Paulo — accounted for 44.1 percent of Brazilian hog production in 2007.
Most of the Brazilian states that recovered FMD-free status are in the Center-West region (including Mato Grosso, Brazil’s largest beef-producing state) which accounts for 35 percent of Brazil’s cattle population, and the South-East region, home to 18 percent of the Brazilian cattle herd. Therefore, more than 50 percent of Brazilian cattle may now be located in FMD-free (with vaccination) regions.
The OIE decision is expected to lead to the lifting of the EU ban on beef imports from the states of Sao Paulo and Parana, but it is not clear at this stage how quickly this will occur. Farms in Sao Paulo and Parana will need to be audited and listed and high cattle prices in Brazil may discourage farmers from participating in the scheme.
After a recent, positive, EU veterinary visit the EU Commission is expected to propose lifting the ban on exports to the EU from Paraguay”s FMD-free zones with vaccination.
The OIE also restored Britain and Cypress to "FMD free country without vaccination" status.
The Philippines is still on the OIE list of countries with FMD despite not having an outbreak for the last two years. The archipelago is certified as FMD-free except for Luzon Island and hopes to be completely approved by February, 2009.
Egypt
Rule Change to Include Canadian and Mexican Cattle Awaits AMS Announcement
Exporters should be aware that although the Egyptian section of the FSIS Export Library was updated May 28 to include Canadian and/or Mexican cattle under 30 months of age, until the Agricultural Marketing Service (AMS) announces the change, the existing AMS EV Program for Egypt remains in effect. AMS is expected to announce the change early next week, after which companies can make the necessary changes to their EV programs for Egypt if they choose to do so.
China Hog Update: Official Earthquake Loss Numbers Increased
China has more than doubled its estimate for hog losses attributable to the Sichuan earthquake, from 1.52 million head to 3.658 million head, including 184,500 sows. Analysts now expect 2008 provincial pork production to drop approximately 9 percent (700,000 metric tons) from 2007 levels, and live hog inventories to decline by 10 million head. Such a loss would equal 1.6 percent of national pork production, and 2.2 percent of national hog inventories.
More details have emerged about specific damage to large meat processing enterprises such as integrator New Hope Group, and Sichuan Gao Jin Food Company, one of China's largest meat processors. Both say that the earthquake has led to major losses and dislocations in production infrastructure, according to an exclusive eFeedLink report on the earthquake's impact on Chinese agriculture. The report states that hog farmers are selling off inventories due to continuing difficulties in transportation infrastructure, contributing to an average drop in Sichuan live hog prices from the pre-quake price of $110/cwt. to $96/cwt. The report concludes that the quake should not greatly impact national market dynamics this year, and China Meat Association analysts recently stated that pork production in China is on track to increase by 2 percent to 3 percent for the year. This potential increase, however, would still put Chinese pork production at 5 million metric tons less than the peak production in 2005, at more than 50 million metric tons.
USMEF-Hong Kong and Guangzhou report that Sichuan traditionally supplies boxed frozen pork to South China and Hong Kong. Hong Kong analysts were quoted yesterday estimating that frozen pork supplies from China would decline by 500 metric tons per month due to the quake. Hong Kong has imported a monthly average of 37,000 metric tons of pork from all sources in the first four months of 2008.
In other news, China announced that from next Friday it would scrap export rebates on 36 types of vegetable oil products. The market impact is expected to be largely psychological since the country's 166,000 tons of oil exports last year accounted for a fraction of total consumption. China’s soybean imports have surged 115 percent in value, to $5.8 billion, with a 21.5 percent increase in volume during the Jan-April period this year. Imports from the U.S. totaled $4.25 billion with the remainder coming from Argentina and Brazil.
Animal Health
Ten Brazilian States Recover FMD-Free Status
The World Organization for Animal Health (OIE) has restored 10 Brazilian states and the federal district to the status of an "FMD free zone with vaccination." According to the OIE Web site:
“The Scientific Commission for Animal Diseases evaluated the documentation concerning the control of foot and mouth disease in Brazil following outbreaks of FMD in two zones... The Scientific Commission … recognized that as from 24 May 2008 zone 1 (the States of Bahia, Espírito Santo, Minas Gerais, Rio de Janeiro, Sergipe, Tocantins) and zone 2 (the States of Distrito Federal, Goiás, Mato Grosso, Paraná, São Paulo) of Brazil have regained their FMD-free status practicing vaccination.”
Five of the states — Minas Gerais, Goiás, Mato Grosso, Paraná and São Paulo — accounted for 44.1 percent of Brazilian hog production in 2007.
Most of the Brazilian states that recovered FMD-free status are in the Center-West region (including Mato Grosso, Brazil’s largest beef-producing state) which accounts for 35 percent of Brazil’s cattle population, and the South-East region, home to 18 percent of the Brazilian cattle herd. Therefore, more than 50 percent of Brazilian cattle may now be located in FMD-free (with vaccination) regions.
The OIE decision is expected to lead to the lifting of the EU ban on beef imports from the states of Sao Paulo and Parana, but it is not clear at this stage how quickly this will occur. Farms in Sao Paulo and Parana will need to be audited and listed and high cattle prices in Brazil may discourage farmers from participating in the scheme.
After a recent, positive, EU veterinary visit the EU Commission is expected to propose lifting the ban on exports to the EU from Paraguay”s FMD-free zones with vaccination.
The OIE also restored Britain and Cypress to "FMD free country without vaccination" status.
The Philippines is still on the OIE list of countries with FMD despite not having an outbreak for the last two years. The archipelago is certified as FMD-free except for Luzon Island and hopes to be completely approved by February, 2009.
Egypt
Rule Change to Include Canadian and Mexican Cattle Awaits AMS Announcement
Exporters should be aware that although the Egyptian section of the FSIS Export Library was updated May 28 to include Canadian and/or Mexican cattle under 30 months of age, until the Agricultural Marketing Service (AMS) announces the change, the existing AMS EV Program for Egypt remains in effect. AMS is expected to announce the change early next week, after which companies can make the necessary changes to their EV programs for Egypt if they choose to do so.