Sanderson: End to trade war would mean big opportunities

While trade barriers exist that are keeping U.S. pork and poultry out of China, Sanderson Farms CEO Joe F. Sanderson Jr. said if the trade war between the two countries were to end, it could create some great opportunities.

Roy Graber Headshot
(Mars1958 | Bigstock)
(Mars1958 | Bigstock)

While trade barriers exist that are keeping U.S. pork and poultry out of China, Sanderson Farms CEO Joe F. Sanderson Jr. said if the trade war between the two countries were to end, it could create some great opportunities.

Presently, China has tariffs on U.S. pork, while it has an avian influenza-related ban on U.S. poultry that dates back to 2015.

Where China will turn for protein

However, with much of the pig herd in China lost to African swine fever (ASF), the country will need to be more reliant on imports – whether they are pork or other proteins – from other nations. While Sanderson stressed that he is not specifically an authority on the topic, he did predict that they will look at regions outside of the United States first.

“There’s a tariff on American pork going over there, so the first pork that they import is going to be from Europe and South America. If that occurs, that’s going to create some opportunities in other parts of the world for protein. They’ll also import poultry, probably, and that will come from Europe or from South America. That ought to make opportunities for American pork and poultry in other parts of the world,” Sanderson said while speaking at the BMO Capital Markets Farm to Market Conference on May 15.

Potential U.S. opportunities in China

And while the ASF situation is apt to create opportunities for the U.S. to export pork and poultry to non-Chinese markets, Sanderson still has his eyes on China.

“We have had inquiries about product availability to go to China already,” Sanderson said, noting that there is a demand for whole legs to be further processed.

Chicken paws are also a popular product in China, but at the present time, the 60 million pounds of paws Sanderson Farms is producing annually are not reaching their full potential, largely due to the poultry ban.

Some of the paws produced by Sanderson are going to market, but many of those paws, Sanderson Farms Chief Financial Officer Mike Cockrell said, are being sold to renderers for 5 cents a pound. Should the Chinese market open up, their value could increase exponentially, Sanderson indicated.

View our continuing coverage of the African swine fever outbreak.

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