Hog virus pushes China to increase U.S. pork purchases despite trade war

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CHICAGO, April 11 (Reuters) – China’s purchases of U.S. pork climbed to the highest in at least six years last week, U.S. Department of Agriculture data showed on Thursday, as a fatal hog disease continued to spread in the Asian country. The sale of 77,732 tonnes of U.S pork in the week ended April 4 gives hope to U.S. hog farmers and meat companies such as WH Group Ltd’s Smithfield Foods that China’s demand will increase further. U.S. pork sales to China sank last year after Beijing imposed retaliatory duties of 62 percent on shipments in the two countries’ ongoing trade war.

The weekly sales were the biggest to China since the U.S. Department of Agriculture records began in 2013.

China has reported about 120 outbreaks of African swine fever (ASF) since it was first detected in the country in August 2018. The disease kills almost all pigs infected, though it is not harmful to people. There is no vaccine or cure.

The precise number of hogs that have been killed by the disease or culled to prevent its spread is not known.

“We all have some big questions about what the exact numbers are,” said Rich Nelson, chief strategist for U.S.-based broker Allendale. “But it’s clear that they are now trying to fill part of this deficit.”

The USDA, in a report published this week, forecast that China will increase pork imports from the U.S. and other countries by 41 percent from 2018 to a record high because of African swine fever. Chinese pork production will likely decline 10 percent due to the liquidation of hog herds, according to the agency’s Foreign Agricultural Service.

“Despite efforts to contain the disease, outbreaks continue to emerge, and evidence mounts that China will be unable to eradicate ASF in the near-term,” USDA agricultural economist Lindsay Kuberka wrote in the report.

A Rabobank analyst projected an even sharper decline of 30 percent in China’s 2019 pork production.

Chinese pig prices have soared as African swine fever has spread, with rising pork prices driving consumer inflation in March to its highest since October 2018, data showed on Thursday. (Reporting by Tom Polansek Editing by Susan Thomas)