HONG KONG – WH Group Ltd., which includes Smithfield Foods Inc., released its annual report showing a decline in 2018 pork profits compared to previous years.
According to numbers released by the company, net profit was at $1.05 billion which is down 4 percent from 2017. WH Group saw total revenue rise $22.61 billion, which is up 1 percent.
A major factor in the annual results was the increased US tariffs throughout 2018 that climbed to 62 percent on July 6. According to the company, the low hog prices weakened the attractiveness of imported pork.
Another factor WH Group citied was problems with African Swine Fever (ASF) in several areas of China. The government adopted measures to control the epidemic including restricting transportation of live hogs within China.
WH Group said its China market saw average hog prices drop by 15.6 percent during 2018 which affected import supply and demand.
The company’s pork revenue worldwide fell 4.1 percent form the previous year to $9.14 billion. Revenue in the US was down 3.4 percent for the company and down 7.8 percent in China.
Operating profit for WH Group declined 55 percent worldwide. It rose 73.8 percent in China but fell 88.9 percent in the US. Hog production increased 20.3 percent in total revenue but fell 27.3 percent in China. It did rise 21.4 percent in the US.