Pigs

(Bloomberg News) — Zhao Baojiang’s fastidiousness about infection control, combined with a towering brick wall protecting his property, probably helped save his 500-hog herd from the deadly contagion that’s ravaged pig farms across China since August. Empty barns around his village indicate few of Zhao’s neighbors were as fortunate.

The infectious disease has killed tens of thousands of pigs in China, which raises about half the world’s hogs. Stopping its spread has resulted in the culling of millions more, including breeding sows and piglets.

The latest government predictions point to a loss of swine this year equivalent to the European Union’s annual supply. Zhao, 67, doesn’t see affected farms recovering anytime soon.

“Not many dare to breed pigs anymore,” Zhao said. “Once your farm is hit with the disease, you’re left penniless — which was the case for many last year.”

China has the highest per-capita pork consumption after Vietnam and the EU. Wholesale pork prices have climbed more than 9% since late July.

Inflationary effect

Domestic pork supply in China this year may fall at least 4 million metric tons below demand, according to Ma Chuang, deputy secretary general with the Chinese Association of Animal Science and Veterinary Medicine. He estimates the total hog population may drop by as much as 30% from 2018 — a loss of about 128 million head.

African swine fever may prompt a dietary shift to alternative protein-rich foods, such as eggs and dairy, Ma said. Meat prices, including chicken, beef and seafood, are likely to rise because of a global shortage caused by China’s outbreaks, according to Rabobank.

Delayed recovery

In Sichuan, where African swine fever was first reported in November, herds may shrink as much as 20% this year, said Hong Ke, who manages one of the largest pig farms in the southwest province. He expects numbers in Henan, the country’s second-largest hog-breeding province, to slide by as much as half.

The loss of critical stock will delay a recovery in production until 2020, according to Ma at the Chinese Association of Animal Science and Veterinary Medicine.

Rabobank, one of the world’s largest lenders to food and agriculture industries, predicts China’s pork output may drop by 25-35 percent while hog herds could shrink by as much as 40 percent this year.

“Next year, supply could be even tighter, with both pork output and hog numbers to drop further,” said Pan Chenjun, a livestock analyst with the Dutch bank in Hong Kong.

Major swine producers may take two to three years to return to pre-outbreak levels, Wens Foodstuffs Group Co., the country’s largest pig breeder, said April 17.

Dou Xingyong, who has been trading hogs near Langfang city in Hebei province for a decade, said about 100 farms closed in the wake of African swine fever, cutting his monthly purchases to 200-300 head, down from as many as 1,000 before the outbreak.

“Some farms slaughtered their entire herds and gave up breeding for fear of infection,” said Dou.