Global Pork Supply Expected to be Tight

The problems of Porcine Epidemic Diarrhoea look likely to affect the global pig markets for some time to come.

Last week the French authorities banned imports of live pigs and other pig products from the US, Canada, Mexico and Japan.

The disease has already killed around seven million pigs in the United States and pork prices are at a record high in an already fragile sector.

According to the French newspaper Le Monde, Jean-Luc Angot, Deputy Director General of Directorate General of Food (EB) and chief veterinarian said that the high losses of pigs is cause for concern.

The fears in France are that if PEDv hits an area with a high density of pigs, such as Brittany, the effects on the industry would be dramatic.

According to the Rabobank Food & Agribusiness (FAR) Research and Advisory group Pork Quarterly report, the ongoing spread of the disease in the Americas and Asia will have a material impact on pork supply both this summer and in the years to come.

It will make the tight global supply which is being caused by Russia’s ban on EU pork imports after recent African swine fever (ASF) outbreaks even worse.

However, oversupply in China is expected to continue, driven by high sow liquidation.

"PEDv has been the driving force pushing up pork prices, especially in the US, to record highs," said Rabobank analyst Albert Vernooij.

"US futures climbed 30 per cent in Q1 and are up 45 per cent over last year, impacting pork users and consumer’s ability to source enough pork for their needs."

Rabobank believes the outbreak of PEDv in the US, Mexico, Japan and South Korea will lead to a likely decline in global pork production in 2014 (against an earlier expected 1.3 per cent increase). In the US, where the PEDv outbreak has been most severe, Rabobank estimates that pork production could decline to mid-single digits (six to seven per cent) in 2014 due to hog losses from the virus.