African Swine Fever: A Global Update – Coronavirus Complicates the ASF Outlook

While African swine fever remains the dominant issue in global animal protein – with change continuing in China, Southeast Asia and Europe – Coronavirus is now complicating the outlook.

Report Summary

For China, and most of global animal protein, 2019 was a year of unprecedented change. China’s pork production declined by over 20% in 2019, hog and pork prices reached record levels and dragged other protein prices up with them, and animal protein imports were above, or close to, record levels across the species. ASF also impacted pig herds and pork production in other parts of the world – across north Asia and Southeast Asia, and in some parts of Europe. Global animal protein trade was heavily shaped by ASF in 2019, with China’s record demand influencing many markets.

In China, the number of new ASF cases, and the number of re-infections, has been declining. In other parts of Asia, the disease continues to spread, with Mindanao island in the Philippines the most concerning case. In Europe, a new outbreak in western Poland is particularly concerning, and a case has been reported in Greece. The disease retains the potential to influence and disrupt production, trade and consumption throughout 2020.

“Coronavirus (or Covid-19) is affecting China’s animal protein production, distribution, consumption and trade in Q1 2020, for all species,” says Justin Sherrard, RaboResearch Animal Protein Strategist. “Our base case is for the disease to be largely brought under control in Q1. As a result we see short-term impacts on consumption, distribution, production and trade, with a strong rebound in Q2. Pork appears to be the least-affected of the proteins, as the shift from foodservice consumption to food retail/home consumption is easiest.”

In addition to the impacts of Covid-19, global trade, and in particular China’s imports, will be influenced by the US-China trade deal, and Chinese authorities’ management of domestic pork prices, in 1H 2020. The combination of these uncertainties will create complications in the near term, but we maintain our view that China will maintain or increase its imports of all species in 2020.