Heed lessons of the pork price hike
2019/9/30
The outbreak of African swine fever last year has brought down the breeding stock of pigs in China. In October last year, the number of reproductive sows decreased by 5.9 percent year-on-year, breaking the 5 percent warning line. The decrease has been expanding continuously ever since, hitting 26.7 percent in June. Since it takes at least 10 months for piglets to mature, and the fall in the number of sows has not been checked, the supply of pork will continue to slip for months.
But history shows when the price of pork goes up, the pig farming industry will increase its investment to quickly expand their breeding scale to gain from high prices, and with the increase of supply, the price of pork will decline soon.
Since the epidemic has been largely controlled nationwide, it will only be a matter of time before the pork supply picks up, and the price falls. The other cause is that stricter environmental protection policies carried out after April 2015 have forced many small-scale pig farms, whose capacity to manage the risks of diseases and price fluctuations is much weaker, to shut down.
The disappearance of small farms means the industry has put all its eggs in one basket－large pig farms. Before effective methods were found to control the outbreak of swine fever, weeding out the small pig farms has actually weakened the whole industry's capacity to cope with the epidemic.
Even if it has affected dozens of countries, the African swine fever should not be classified as "natural disaster" to justify the pork price hike. The authorities have plenty of lessons to draw from the dramatic changes in the pig industry to improve their adaptability and risk-prevention ability for the management of the food industry.
(from http://www.kekenet.com/read/201909/594251.shtml)
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