China’s ban on German pork because of an outbreak of African swine fever will be damaging to farmers and could affect prices across Europe, analysts said.
German firms might also lose market share to American suppliers as China rushes to meet the purchase pledges it made under a trade deal with Washington, they said.
China is the world’s largest consumer of pork but halted imports of the meat from Germany on September 12 after a wild boar was reported to have died from the fever near the country’s eastern border with Poland. A further six cases were reported in the country in the days after the ban.
Get the latest insights and analysis from our Global Impact newsletter on the big stories originating in China.
Several other countries, including Japan and South Korea, imposed similar bans on German pork as fears grew the disease would spread to the country’s domesticated hog population.
Pork prices in Germany fell by about 13 per cent to €1.27 (US$1.50) a kilogram on Friday.
“A price about €1.25 per kilo is just not feasible for us, and would push us into negative margins,” said Bernhard Krüsken, general secretary of the German Farmers Association.
“China has grown to be a very important customer for Germany and European pig farmers in recent years,” he said.
Berlin said this week that China had overtaken the United States as the biggest foreign market for German pork, buying about €1 billion worth of it every year.
Germany sold 233,300 tonnes – more than a quarter of its total exports of the meat – to China in the first six months of the year.
China was forced to raise its pork imports after an outbreak of African swine fever in 2018 decimated pig populations, though numbers have been steadily growing. In the first eight months of 2020 it imported almost 6.6 million tonnes of the meat, or more than it bought in the whole of last year, according to customs figures.
Krüsken said he was concerned that the ban might lead to German firms losing market share to their competitors.
Under a phase one trade deal between China and the United States signed in January Beijing agreed to greatly increase its purchases of American agricultural goods.
“There may be a market opportunity for US pork producers as a result of German pork being banned in several countries due to the African swine fever outbreak, but we can’t speculate,” said Jim Monroe, spokesman for the National Pork Producers Council in the US.
Feng Yonghui, chief analyst at Chinese pork industry website Soozhu.com, said firms in export-dependent Germany might have to cut jobs and could be pushed to bankruptcy.
“The effects are likely to be felt across Europe. But the ban will not have a very big effect on the price of locally reared pork in China,” he said.
Pekka Pesonen, secretary general of Copa-Cogeca, a union of European farmers, said the discovery of infected wild boars in Germany was a cause for concern for all.
“At a difficult time for the European pig meat sector, it is essential that European and national authorities take efficient and quick measures to support the sector,” he said.
Additional reporting by Reuters
More from South China Morning Post:
- China bans German pork imports after African swine fever case
- Chinese vaccine for African swine fever advances to next trial phase
- Coronavirus: China bans imported pork from German meat plant after more than 650 infected in outbreak
- German pork farmers fear China import ban amid swine fever outbreak
This article African swine fever: China’s ban on German pork bad news for pig farmers, analysts says first appeared on South China Morning Post