KANSAS CITY, Mo. – The spread of African Swine Fever (ASF) potentially is the biggest global animal health story that no one is talking about much. But agriculture industry analysts believe it’s a story that should receive a fair hearing from industry stakeholders as China, the world’s largest producer and consumer of pork, battles outbreaks of ASF within its borders.
“It brings a tremendous opportunity for the animal protein complex, and that will have knock-on effects to corn and soy production,” Curt Hudnutt, executive vice president of Rural Banking, North America, at Rabobank, said during a panel discussion at the 2018 Ag Outlook Forum held recently in Kansas City, Missouri.
Hudnutt said the global swineherd is roughly 250 million head. Roughly 50 to 55 percent of that number of swine is produced in China with about 40 percent of China’s swine herd categorized as backyard hogs.
“So, the ability to contain the spread of African Swine Fever in China is very low,” he said. “There’re at least 23 confirmed cases in China, which means, as we all know, there’s a lot more than that. If you look at the geographic dispersion of those cases, it’s across almost the entire country.”
In September, officials in Belgium confirmed the presence of ASF in two wild boar in a town roughly 10 km from France. Hudnutt said that finding coupled with the presence of wild boar throughout the region has stoked fears the disease could spread into The Netherlands, then Germany and throughout the continent. “An outbreak in Europe could be traumatic to global pork production,” Hudnutt said.
ASF is a hemorrhagic disease of pigs, warthogs, European wild boar and American feral pigs. Swine of all age groups are susceptible to it, and clinical signs of infection can vary from mild to 100 percent death rates in swineherds. Death can occur within two to 10 days on average. Vectors for transmission of ASF include biting flies and ticks, direct contact with other swine, and garbage containing unprocessed infected pig meat. But an especially troubling characteristic of ASF is that it can survive in feed ingredients. Arlan Suderman, chief commodities economist at INTL FCStone, said because the ASF virus can survive in the environment for extended periods it’s easy to spread.
In China, Suderman explained, “…their production areas are primarily in northeastern areas of China where grain production is. The Chinese people love fresh pork, and so the slaughterhouses are in the southern populated areas. So, they had hogs with the disease transported 1,400-1,500 miles to the south through high-production areas.
“You go that far, you have to wash down your trucks periodically,” he continued. “The disease was spread and now it’s spread throughout a large area of the country that has 55 percent of the world’s hogs.”
“This is a disease we need to keep our eye on,” Suderman added. “There’s not a lot of confidence that China has control over it.”
Disruption to pork supplies in China is problematic for the Chinese government. Restrictions on movement of pigs has disrupted the north-south supply chain. This has led to food inflation in China, according to Suderman.
“Pork is the No. 1 meat of choice in China; it’s the No. 1 driver of food inflation, and food inflation is the No. 1 driver of social unrest around the world, and China doesn’t want that right now particularly when they’re in a battle with the United States — this tariff war,” Suderman said.
“I think we could, in 2019, see some significant dynamic shifts in the global protein complex as far as movement of pork [and] poultry,” Suderman added. If those shifts raise production of pork, poultry and perhaps beef in other parts of the world, where the soy meal flows in the world also could be impacted.
Rob Johansson, chief economist for the US Dept. of Agriculture, said whether or not ASF expands into Europe will be a big question mark, and the disease will l have different effects in different sectors.
“We are starting to incorporate those into our estimates,” Johansson said. “It could be a huge issue for the protein sector.”