Newspork exports
Jun 18, 2024 07:25 PM EDT
According to merchants and economists, if Beijing bans imports from the European Union due to the intensifying trade tensions, pork exporters from South America and the United States may gain market share in China.
Russia, which began exporting pork to China in February and is becoming a closer commercial partner of China, may also increase meat supplies.
The EU imposed anti-subsidy levies on electric cars manufactured in China; as a result, China's commerce ministry announced on Monday that it had opened an anti-dumping investigation into EU imports of pork and its byproducts.
The impact on EU exports due to China's investigation is not immediate, as the process could take over a year. If exports from the European Union are restricted, nations such as Brazil, Argentina, and the United States are likely to increase their pork and offal exports to China. Should the anti-dumping tax imposed on the EU be excessively high, it would create further opportunities for these countries to boost their shipments to China.
The U.S. Meat Export Federation (USMEF) highlighted that U.S. pork currently faces retaliatory duties of 25% in China due to steel and aluminum tariffs. This raises questions about whether U.S. pork will continue to face a tariff disadvantage compared to EU pork. Smithfield Foods, a subsidiary of Hong Kong-listed WH Group Ltd, is well-acquainted with the impact of these Chinese tariffs and would benefit from any potential relief.
Anti-dumping duties could significantly impact European pork exports to China, particularly because China's purchases from Europe include parts like feet, ears, and offal that are primarily used for pet food in Europe. Despite this, analyst Pan Chenjun believes the effect on China's market will be limited. Since imports of pork and offal make up only 5% of China's total consumption, any restrictions on European imports are unlikely to significantly affect local supplies and prices.
According to USMEF's Schuele, China may present more chances for American pig variety meats such as feet, stomachs, heads, and neckbones.
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According to customs data, China imported $6 billion worth of pork 2023, including offal.
It produces the majority of pigs worldwide and eats around half of all pork produced.
Although domestic hog prices collapsed, this year's glut abated as producers killed fewer pigs to stimulate the market.
According to an Asian animal feed dealer, any interruption in EU trade might benefit Brazil, China's top agricultural trading partner.
The trader, who wished to remain anonymous due to lack of authorization to address the media, stated that Brazil will have no trouble gaining market share because of its fierce pricing competition.
Russia has room to develop as well; in three to four years, the National Union of Pork Producers in Russia hopes to account for 10% of China's pork imports, according to Yuri Kovalev, the chairman of the organization.
Russia exported 4,260 metric tons of pork to China as of June 2. However, earlier this month, Sergey Dankvert, the chairman of the Russian agricultural watchdog Rosselkhoznadzor, stated that Russia might export up to 100,000 tons of pork to China by 2024.
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