The global market is on the verge of a pork glut, warns a report from Rabobank.
China is ramping up production, planning to build several hundred large hog farms.
But the United States, Canada and Brazil are also planning on exporting more pork to China and hog farmers in Europe are increasing production.
That extra pork may instead depress global pork prices, says the report from Rabobank.
U.S. pork production is forecast to increase by 4.3 percent this year, and strong exports at the beginning of 2018 have “intensified the competition for market hogs to the detriment of packer returns,” Rabobank said in its Pork Quarterly report.
Slowing imports into China are the “most significant story” in global pork markets, the bank said, but imports should pick up somewhat over the rest of the year.
Reuters reports on the big production increase in China, saying the big farms are to replace hundreds of thousands of backyard pork farms.
However, challenges including higher feed costs, new environmental laws and an insufficient number of adequately trained workers may allow imports to China from other countries to continue at current levels for at least this year, says Reuters.