Biggest Pork Exporters Look to Markets Outside of China

With CHINA importing less pork this year, where will the EU, US , CANADA and Brazil EXPORT their products to?

Following a shortage in the supply of pork caused by African swine fever (ASF), import demand for pork in China has skyrocketed, with imports almost quadrupling in 2020. Pigs around the world have been expanding production, moving products from their home markets, and redirecting pork to other destinations. In 2021, as China 's economy recovers, imports are down 20% from the previous year's record high. Large exporters were looking for alternative markets, but most of them, with the exception of Brazil, were unable to redistribute such large supplies, and trade declined.

Pork imports from China are projected to fall by almost 20% in 2022 and lead to lower global trade volumes, more than offsetting a rebound in demand in other major importing countries as they recover from COVID-19- related disruptions . . As growth in other markets again fails to offset the decline in China, most major pork exporters will face a second year of supply cuts.

In the European Union (EU), China's top supplier of pork and the world's largest exporter, exports are forecast to decline by 5% to just under 4.8 million tonnes this year. EU exporters are expected to find some relief from lower demand in China in the form of higher demand in the UK, where imports are projected to rise by 7% in 2022. The EU will also increase supplies to Japan, SOUTH KOREA and Australia, countries to which EU exports have declined in recent years as sales have shifted to China. Competitive carcass prices in the EU compared to the US and strong demand will help boost supplies to these markets in 2022.

U.S. pork exports are forecast to be down 6% from last year. China's demand for US products was one of the first to come under pressure, with US shipments to this important market falling for each month of 2021 year-over-year due to high US prices and retaliatory tariffs. These factors are expected to continue into 2022, leading to a further decline in US market share. Partially offsetting losses in China, demand for American pork is expected to pick up in Mexico. Going forward, growth is expected to continue in Colombia and the Dominican Republic, albeit slower than last year, as high prices in the US create headwinds.

In 2022, Canada's exports are expected to decline moderately - by 1% year on year. Like the United States, Canada faces obstacles in China. At present, most Canadian pork production is still on hold in China due to reports of covid cases at several facilities; however, most cases occurred several months ago and are not necessarily active outbreaks. Limited supplies to the United States, Canada's main export market, will help offset declining supplies to China.

Of the top four exporters, Brazil alone saw total shipments up in 2021, driven by strong production growth, competitive prices and a weak real. Even exports to China increased year on year as Brazil increased its market share to 16%. In 2022, Brazil is expected to maintain its total exports with modest growth of less than 1%. In China, Brazil is likely to capture most of the shrinking pie thanks to more competitive prices compared to other major exporters. Meanwhile, Brazil continues to perform well in Vietnam and the Philippines, while demand is growing in neighboring Argentina and Uruguay.