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Meat Prices Seen Rising as Deadly Virus Wipes Out Chinese Hogs

Meat Prices Seen Rising as Deadly Virus Wipes Out Chinese Hogs

(Bloomberg) -- Meat prices -- whether it’s chicken, beef, seafood or even fake meat -- are likely to rise because of a global shortages caused by a deadly hog virus that’s sweeping across China.

That’s according to a new report by Rabobank, which predicted widespread knock-on effects for the agriculture industry globally as African swine fever decimates Chinese hog farms. More than a million hogs have been culled in East Asia since the disease first appeared in August, and the consequences are already reshaping global trade.

Chinese pork production may decline about 30 percent in 2019 because of the virus, Rabobank predicted. To put that figure into context, a drop of that size would be roughly the same as Europe’s entire annual pork supply, the bank said.

China is the world’s biggest hog producer and pork is the principal source of dietary protein. The most virulent form of the disease can be 100 percent lethal for pigs and wild boars, and there’s no vaccine.

Meat Prices Seen Rising as Deadly Virus Wipes Out Chinese Hogs

Chinese consumers will have to eat less pork and turn to other kinds of meat, like poultry, beef, fish and "alternative proteins," according to Rabobank, a Dutch lender that specializes in agriculture financing. Additionally, meat supplies around the world may be redirected to China to satisfy the country’s deficit in protein, the bank said.

"The price of all proteins is set to rise pretty substantially," said Christine McCracken, an analyst at the bank. “It would be our expectation that as China imports more pork, supplies in other countries will get tighter and prices will go up, not just for pork, but for other proteins as well."

“It will take at least three years to rebuild the industry without any risk of reinfecting the herd,” she said.

There are already signs that Chinese food preferences are changing in response to the crisis. Feed manufactured for poultry and fish farming rose last year, signaling increased production, almost certainly in response to higher demand. By contrast, feed made for hogs shrank 1 percent, according to industry association data.

Read: Chinese Switch to Fish From Best-Loved Pork as Hog Virus Spreads

--With assistance from Alfred Cang.

To contact the reporter on this story: Irene García Pérez in London at igarciaperez@bloomberg.net

To contact the editors responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net, Liezel Hill

©2019 Bloomberg L.P.