From Reuters:
Chinese pork prices are set to jump 70 percent in the second half of the year, a senior official said on Wednesday, after data showed an outbreak of African swine fever cut the world’s largest hog herd by 10 percent in the first quarter.
China’s pork production fell 5 percent in the first three months of 2019 and much bigger declines are expected in coming quarters, analysts said, as the country struggles to contain the spread of the deadly disease.
The forecast comes as Washington and Beijing are trying to hammer out a deal to end a months-long trade war that could include China buying more U.S. pork to meet a growing supply deficit, sources told Reuters.
“Second quarter [production] will see a marked drop from the first quarter, and the third quarter could be even bigger,” said Feng Yonghui, chief analyst at industry website Soozhu.com.
The fall in pork output in the first quarter was muted by demand during China’s Lunar New Year festival in February, with farmers worried about weak pig prices rushing animals to market, Feng said.Additionally the "Hog cycle" is going to suffer a time-shift as officials order delays in rebuilding the herds until after the disease has run its course. Here's the ten second tutorial on Ag cycles:
But a large decline in the breeding herd means output of the country’s most popular meat will continue to fall sharply....MUCH MORE
April 23, 2008
The Hog Cycle
No not Harley-Davidson, although I imagine some econ grad student has written the paper.
Wheat and hogs are two commodities with long price series. We mentioned the hog cycle back in January:
The hog price series is one of the longest we have records for, back to the 1200's. The cycle is:
slaughter begets scarcity begets higher prices begets breeding begets over-supply begets slaughter. It's been going on for a while....
