The U.S. is lagging in race to feed China’s giant appetite for pork

China has the world’s biggest appetite for pork. It’s such a beloved staple that the written Chinese character for “home” depicts a pig inside a house. U.S. producers banked on that business being around for years.

That’s changed. As a result of the Trump administration’s clash with Beijing over trade, China’s tariffs on U.S. pork have climbed as high as 70%, making U.S. imports more expensive. At the same time, an outbreak of African swine fever in China has increased demand for imported pork.

Commentary: We could have had a better deal than this new and not improved Nafta

Democratic House Candidates Dominate in Fundraising

To fill the void, Chinese customers are increasingly looking to companies in Europe and South America to fill their orders—and those companies aim to turn that opportunity into long-term business. The shift raises the prospect of not just a short-term hiccup for American hog farmers, but a fundamental realignment in the global supply chain in one of the world’s hungriest markets.

ElPozo Alimentación SA, one of Spain’s largest pork companies, started getting more calls from Chinese meat processors in September. John Hickin, manager of Asian sales for ElPozo, says processors told him they feared China’s domestic pork supplies could run thin as tens of thousands of hogs were being culled to stop further outbreaks of African swine fever—a disease fatal to hogs and harmless to humans.

The inquiries continued through a week-long Chinese holiday in early October, when business usually shuts down. ElPozo’s Shanghai-based staff of three stayed at work that week to fill the orders.

ElPozo is breeding more pigs on farms near its headquarters in the southeastern Spanish region of Murcia to fulfill what executives hope will be a 40% sales boost over the next four years, thanks to rising exports to Asia and Latin America. Hickin said he and his colleagues recently hosted around 20 potential new Chinese customers at their headquarters.

An expanded version of this report appears on

Popular on

You want 20% for handing me a muffin? The awkward etiquette of iPad tipping

Funds back proposal to remove Zuckerberg as Facebook chairman

Want news about Europe delivered to your inbox? Subscribe to MarketWatch's free Europe Daily newsletter. Sign up here.

Source: Read Full Article