Predicting export levels in the age of COVID-19 is a guessing game, but the first quarter of 2020 has been a surprisingly good one for global pork demand, thanks in large part to China.
“We’ve performed very strongly in that market,” says Maria Zieba, director of international affairs at the National Pork Producers Council. “There’s a tremendous need for pork in China.”
The demand for pork in China was expected, says Iowa State University economist Dermot Hayes. That nation’s struggles with African swine fever and the announcement of a Phase One trade agreement at the start of the year both pointed toward increased pork exports.
But the fact that there is still a 25% tariff on U.S. pork products going to China tempered the predictions of increased exports. And the COVID-19 situation added more confusion.
That makes the news from the first quarter especially welcome.
“This China business is huge,” Hayes says.
The January through March figures indicate exports to China were up by over 300% from the same time period in 2019, Hayes says.
And there has been another benefit as well. It has long been true that some export markets consist of cuts of meat that are not as popular in the U.S. market. But while exports to many nations consist of boxed pork, China has often been buying bone-in carcass sections. In some cases, the front and rear thirds of the carcass are exported while the middle third is cut and boxed for the domestic market. This has meant fewer issues with production lines in already COVID-stressed U.S. packing plants.
Whether this trend will continue is anyone’s guess, but numbers from other parts of the world were also promising.
When measured by tonnage, exports to Mexico were up by 10% and to Japan they were up nearly 12%. Exports to Canada were up by more than 13%. Those are the top four export markets for U.S. pork.
The fifth largest importer of U.S. pork is South Korea and that was one negative in the first quarter, with U.S. exports down by nearly 13%. The coronavirus was a factor in that decline in South Korea, Zieba says, as that nation was quick to shut down its economy. It will be interesting to see if that market recovers in the second quarter, she says,
How well those first quarter numbers signal what may happen the rest of the year is difficult to know, Zieba says. The COVID-19 situation is fluid and it complicates any prediction.
Still, she says, things are off to a good start.
“It’s looking good right now,” she says.