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World compound feed production by species

African swine fever leaves 'huge hole' in pork production

Anticipating a precipitous drop in Chinese pork production, other countries look to fill the gap

Despite mounting uncertainty, the animal feed industry remains optimistic about the long-term prospects for swine feed production.

The pork industry enjoyed modest gains in 2018 for the third year in a row. But a massive outbreak of African swine fever (ASF) in China, the world’s largest pork consumer, is expected to bring a precipitous drop in pork production in the months to come.

Pork production in Asia had already decreased 3% in 2018, according to the 2019 Alltech Global Feed Survey, and could drop as much as 30% by 2020 due to the ongoing outbreak.

But what this means for the greater pork industry — and for swine feed production — is unclear. Other nations are poised to pick up at least some of the slack. The U.S. and EU have already seen an increase in pork exports, though sour relations between the U.S. and China have slowed growth.

India may also see gains. The southeast Asian country saw significant increases in pork production in 2018 thanks to the growth of industrialized farming and increased domestic feed milling. Feed production across all species jumped 13% in India in 2018.

Thus, there is some cautious optimism among pork producers outside countries affected by ASF. In the U.S., decreased Chinese demand for feed ingredients, exacerbated by the ongoing trade war, is likely to drive down feed prices, which could increase profitability for domestic pork producers, according to Chris Hostetler, director of animal science for the National Pork Board.

“There is a lot of optimism right now, in terms of where the U.S. will fall in replacing that 30% hole,” Hostetler said. “I think the futures market would bear witness to saying we’re going to continue to expand the U.S. herd.”

Delayed planting and flooding in the Midwest could push prices upward, Hostetler said, but he expects the effects of ASF to outlast the flooding impacts. And the emphasis on feed efficiency in the U.S. pork industry means there just isn’t as much demand for feed per pig as there once was.

However, the real factor that could drive feed production for swine in the coming years is whether the U.S. and other countries will be able to make up for the losses in China.

“Their sow herd was significantly larger than our sow herd” in the U.S., Hostetler said, “and they’ve lost more pigs due to ASF than what we have in production. It’s going to be a huge hole.”