China Market Report, Sept 2018

Lyle Jones, Director of Sales in China, Genesus Inc. 

We just returned from 2 weeks of travel within China. While the Swine Industry continues to transform from its old style backyard production to new and modern facilities with better Genetics and higher technology, there is growing concern over recent outbreaks of ASF. Just yesterday, we noticed this announcement from the Ministry of Agriculture:

“Since the first African swine fever epidemic in China on August 3, there have been 15 epidemics in six provinces. On September 11th, in order to cut off the transmission chain of African swine fever virus and reduce the risk of cross-regional spread of the epidemic, the Ministry of Agriculture and Rural Affairs announced that 10 provinces adjacent to the provinces where the African swine fever epidemic occurred in Hebei, Shanxi and Inner Mongolia were suspended from inter-provincial transportation. At this point, pigs in 16 provinces were prohibited from inter-provincial transportation.”

These growing and more frequent reports are affecting producer’s actions and also market conditions. We are being told that many farms are locking down and not allowing their people out nor outside people in. Bio-security has long been a challenge in China and now owners and managers are taking unprecedented steps to protect their facilities from contracting this devastating disease.

Who knows how long farm workers will be content under these lockdown conditions, but many farms are now providing housing, cafeteria, laundry and even barbershop services for their workers. Many farms are becoming almost like small communities with all the comforts of home and even recreational facilities. So they may be able to withstand these conditions for some time.

However, local markets are reported to be very volatile as no pigs can ship to a naive province from any of the provinces infected with ASF.  Nor can pigs be transported from the province of the neighbor of the infected province. That had caused a big variance on hog price from the province to province. Looking at the attached map from the announcement, the red is infected province and the blue is their neighbor as.