As global pork shortage looms, will China open its strategic pork reserve?
Get your Baconators while you still can. There’s some disturbing news out of Europe, reports the FT: Data showing the EU pig herd is declining “at a significant rate” in a trend mirrored around the world means a world shortage of pork and bacon “is now unavoidable”, according to Britain’s National Pig Association. In the ...
Data showing the EU pig herd is declining “at a significant rate” in a trend mirrored around the world means a world shortage of pork and bacon “is now unavoidable”, according to Britain’s National Pig Association.
In the 12 months to June, sow herds have fallen by between 1 and 10 per cent. Poland has seen the steepest drop, down 9.6 per cent, followed by Sweden and Ireland. In the UK the NPA reckons output could fall by as much as 20 per cent, based on surveys of farmers.
The LA Times adds:
In U.S. warehouses, pork supply soared to a record last month, rising 31% to 580.8 million pounds at the end of August from a year earlier, according to the U.S. Department of Agriculture.
The surge came as farmers scaled down their herds as feeding the animals became increasingly expensive.
But of course, with 446 million pigs — one for every three people — China is the world’s undisputed porcine superpower. The Saudi Arabia of pork if you will. Fluctuations in pork prices have the power to drive the country’s inflation rate and analysts joke that CPI actually stands for "China Pork Index". As Reuters reported earlier this month, China has been moving away from backyard pigpens to industrial scale farms largely as a means of minimizing price variations and keeping inflation rates more stable.
As FP noted last year in our food issue, after a disease outbreak forced millions of pigs to be slaughtered in 2008, driving prices through the roof, the government established a "strategic pork reserve," maintaining "icy warehouses around the country stocked with frozen pork that can be released during times of shortage."
For now, China’s pork supplies are ample, but if global pig prices start to rise during China’s politically sensitive leadership transition, could we see Beijing releasing reserve pork onto the market?
4Who’s Afraid of a Balance of Power? 2007 Shares