China’s pig industry will rise like a phoenix

China was hit hard by the African Swine Fever (ASF) outbreaks in 2018 and 2019. Most estimates indicate a pig industry size reduction of more than 50%. What does that mean for the years to come? China will come back for sure, but how quickly, and what will the impact be? Richard A. Brown, a director of Gira, explains.



nexpected”, “unprecedented” and “having severe consequences”. That is what char- acterises a “black swan event”, and it is the phrase Richard Brown likes to use to de-

scribe the occurrence of ASF in China and Asia. Brown is a di- rector of Gira Consultancy and Research, based in the UK and France. As such, he has been focusing on the virus and its tragic effects in the short and longer terms for China and the rest of the world. Rare as black swans may be, one black swan event has just been overtaken by another one: Covid-19, which is likely to have severe consequences for the international pig market as well. More about that a little later in this article – and – no doubt, in later future editions of Pig Progress. In this article we zoom in on the short-term and longer term effects of ASF. Over the last 12 months, Brown has repeatedly been asked to share his views on ASF at congresses and other events across the globe – one of which Pig Progress attended. Brown has an excellent overview of the meat and pork trade, what type of disruptions the ASF deficit in Asia will lead to – and how the markets will bounce back in the medium and longer terms.

▶PIG PROGRESS | Volume 36, No. 3, 2020

Drivers and brakes in global meat market In Brown’s view, an analyst must take into account a long list of drivers and brakes to the global meat market. Among drivers, he includes factors like population growth, income growth, urbanisation and better meat marketing. The brakes category includes price, the growth of vegetarianism as well as social pressure and negative publicity. It also includes ani- mal diseases like ASF. Before the ASF shock, Brown explains, further increases in per capita meat consumption were anticipated in 2019 for most world markets. Similarly, even without including ASF, a growth in meat trade volumes was forecast for all species in 2019. Taking into account the spread of ASF, the effects of the virus are massive, complex and highly variable (see Figure 1). Brown’s hypothesis about the short-term effects is that ASF is decimating China’s pork production, predominantly by wiping out small backyard pig farmers. In 2019 he calculated a severe supply shock, with a production decline of 18 mil- lion tonnes carcass weight equivalent (CWE). For 2020, the market will feel an echo with a further production decline of 6 million tonnes CWE. For the years after 2021, however, the perspective changes, Brown says. For 2021 and beyond, he predicts a rapid recov- ery driven by strong investment in commercial farms. That in turn will be pulled by two factors, the first being re- cord pig prices (and profit) and the second the fact that the Chinese government will make recovery of the pig business a priority. All in all, he says, the structure of China’s pig industry will be completely different post-ASF.


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