Pig trade awaits unique change

Rabobank is counting on this during the second half of 2018 the pig trade will be more affected by escalating tensions in world trade. This includes the riot between the United States (US) and China, but also the unrest in North America. “The major changes in the pork trade reflect increasing political and economic tensions in the world,” said Chenjun Pan, senior animal protein analyst at Rabobank.

China's pig sector is growing
The largest Dutch bank also expects that China will import less pork in the second half of the year. This is partly due to the trade war. Meanwhile, the Chinese pig sector growing, due to low prices. This is because the smaller companies stop and the large companies become even larger, which on balance produces more pigs.

The bank also expects that Brazil and Europe may benefit from the trade barriers. Whether that will actually happen remains to be seen. This often means that a product that first went to China now appears in other markets and at lower prices. This would negatively affect pork prices worldwide.

more pigs
Yet another point is the increased production of pork in the first half of 2018. This will continue to put pressure on prices in the second half of 2018. Another thing to keep an eye on is the African swine fever. Because it is expanding continuously out in Europe.

The last point mentioned is the rising prices for animal feed. They will also put pressure on margins. All together could give pig farmers an uncertain second half of the year.