USMEF Panel Focuses on Trade Implications of African Swine Fever

Prevention of African swine fever (ASF) in North America is critical, but so is preparation for a response and recovery if the disease does make it here. That was the precaution offered by Dr. Dave Pyburn, senior vice president for science and technology for the National Pork Board, who presented “African Swine Fever and Swine Business Continuity Planning” as part of a panel discussion on ASF at Friday’s closing business session of the USMEF Spring Conference and Board of Directors Meeting in Kansas City.

Dr. David Pyburn, senior vice president for science and technology for the National Pork Board, presents on African swine fever at the USMEF Spring Conference in Kansas City

Pyburn has been, and continues to be, in close contact with those on the front lines of ASF in Asia and other infected regions around the world.

“As I watch this virus move across many countries, it concerns me with what the future holds,” Pyburn told USMEF members. “For the pork industry, this is the most devastating disease that we could get. With this strain of ASF, which is the same across Russia, across the Baltics, across Eastern and Western Europe – and now in Asia – it’s all the same. From what I’m hearing from people on the ground, when you look at domestic animals, within about 10 days of an individual animal infection that animal is dead. When you start looking at large units that get infected, about 80 percent of hogs in that unit are going to die from the virus.”

Pyburn went on to explain the current situation in China, which is home to about half the world’s pigs. He talked about China’s swine repopulation failures in wake of ASF.

“What you need to remember is that some of these pigs that are dying are sows, and China’s breeding was already shrinking when the disease hit,” he said. “I have yet to hear of any large swine units that have been successfully repopulated there. In fact, some barns that once were full of hogs now hold poultry.”

Other Asian countries are suffering, too. Pyburn noted that Vietnam is experiencing a rapid spread of ASF and is estimated to have lost more than 1.5 million hogs. Hong Kong, which imports hogs from China for slaughter, has seen unrest due to the shortage of fresh pork. No one knows what’s going on in North Korea, but it is suspected there are ASF-positive cases there as well. South Korea and Thailand “are very nervous” about ASF entering those countries, Pyburn said.

He detailed the impact that could be felt if ASF is confirmed in the United States:

• Export markets would likely close
• Consumer confidence in pork could falter
• Pork prices could collapse to market-clearing levels

USDA does not allow import of pigs or fresh pork products into the U.S. from areas or regions of the world that are reported positive for the ASF virus. Pyburn listed some of the transmission threats that could bring ASF to the U.S., including feed and feed components, contaminated clothing and ticks brought into the country.

Preparation for ASF in the U.S. should include consultation and cooperation with Mexico and Canada, Pyburn noted. A toolbox should be built that features surveillance plans, a network of veterinarians, a credible detection system and regular communication.

Joel Haggard (at podium), USMEF senior vice president for the Asia Pacific, discusses the effects of African swine fever on China’s pork industry

Joel Haggard, USMEF senior vice president for the Asia Pacific, provided the audience with some insight about the impact of ASF on China’s pork market but cautioned that accurate figures are hard to obtain.

“As I’ve said many times, it’s very difficult to get information because the latest statistics show there are still 25 million hog producers in China,” Haggard said, “so what we’re concentrating on is really trying to look at the import side. That’s a bit more transparent because we have the statistics, although delayed. We’re also trying to find any tidbits on what’s happening on the consumption side.”

Haggard noted that the anticipated “hole” in China’s pork production has not yet generated a surge in imports, but a significant increase is expected to come soon.

Haggard also commented on China’s regulatory efforts in response to the ASF crisis, including new requirements for the country’s pork processing sector. When asked about China’s stocks of frozen pork, Haggard noted that a large volume of product entered the market prior to China implementing ASF testing requirements.

“The consensus is that China started to fill their freezers last fall as farmers rushed to sell because they were afraid of ASF breaking on their farm,” said Haggard. “The regulation requiring pork coming out of freezers to be tested by processors wasn’t implemented until May 1 of this year. So then the question becomes, is this pork coming out of freezers being tested? It seems like that would be a very complicated operation.”

USMEF Economist Erin Borror shed light on the potential effects of ASF on the global pork market, as well as on trade of other proteins.

“ASF-driven pork shortages, especially in China, will drive global pork trade to record levels in 2019-2020 and over the near term,” she said.

Simply put, there is not enough global meat to fill China’s needs while also meeting demand in the rest of the world.

“Thus prices for hogs and pork are trending higher and this will continue in an effort to ration supplies – and send the signal to producers to expand or rebuild where possible,” said Borror. “The China pork shortage will support prices for other meats, including beef, and China’s imports of all meats will be record-large.”

Borror noted that the U.S. is the best-positioned nation to expand pork exports because of its production growth, but market access issues – including retaliatory duties imposed by China – continue to handicap U.S. exports.

“U.S. exports to China will depend on a U.S.-China agreement, but keep in mind that U.S. pork and beef will also be highly demanded in other major import markets,” she said.

The ASF panel discussion marked the conclusion of the USMEF Spring Conference and Board of Directors Meeting. The federation’s next meeting is its annual strategic planning conference, set for Nov. 6-8 in Tucson, Az.