Global meat experts speaking at the World Meat Congress (WMC) 2016 in Uruguay have allayed fears that China’s meat imports could decline as its economic growth cools to a single-digit rate of expansion.
In fact, China could be set to import an astounding 10 million tonnes of meat by 2020, according to Justin Sherrard, chief animal protein strategist at Rabobank.
“I’m excited that China’s future demand for meat imports could be higher than we’ve ever expected,” said Sherrard at WMC 2016.
“We believe China’s pork imports will remain strong, but there are many new players entering the market which increases the competition for all other players,” Sherrard noted. He added that China’s strong import projection may boost global pork prices, although he did not provide a figure.
China’s economy has grown by 6.7% for the third consecutive quarter, according to the National Bureau of Statistics of China. And the irrefutable fact that China’s economy is slowing down has caused concern to markets, with meat exporters anxious that fresh and frozen pig meat trade may also start to stagnate.
Luckily there’s very little chance of this happening in a market where pork imports grew by 160% in the third quarter of 2016, according to UK levy board AHDB . And experts at WMC tipped pork exports to the world’s second-largest economy to continue with vigour.
China’s imports of beef and poultry are expected to decline, but Richard Brown, director of food research consultancy GIRA, said the better-than-expected demand for pig meat in China is a major boon for the global pork trade.
“If China can maintain its economic growth and continues to experience problems in domestic agro-industrial production, a price lift for pork may come more quickly than we expected,” said Brown at WMC 2016.
Brown also used his speech to call for improvements across the meat supply chain.
“We need to respond to the market challenges in a positive way. We need to have communicative meat chains that work together and where producers are not in continual war with meatpackers and other players along the chain. We need a more cohesive and less conflictual way of trading meat.”
The need to improve meat supply chains will also be increased as pork export competition in China intensifies as markets such as Brazil enter the fray. Players likely to succeed in the “competitive and complex” Chinese market will be those that are agile, well-attuned to market dynamics and have strong supply chains focused on adding value, not chasing prices, added Sherrard.