Specialist
Former C-level Executive at Seaboard Triumph Foods
Agenda
- US pork pricing analysis and macroeconomic pressures, including the impact of the US-China trade war and African swine fever on China's pigs
- US market impact following China's pork import cancellation
- Key companies impacted by swine fever and adjacent categories including grains, oilseeds and other protein alternatives
- H2 2019 outlook – pricing pressures and China's pork sourcing opinions
Questions
1.
What’s your updated perspective on the global pork market? Given the recent macroeconomic pressures including the China-US trade war and tariff dynamics and the impact of African swine fever on China's herd, what are you paying attention to and what should we be cognisant of?
2.
Could you give a bit more colour on the context of the United States Department of Agriculture (USDA) cutout pricing? When thinking about how the pricing trends are continuing, you mentioned how opening facilities and the capacity cost is one factor, but how might opening additional facilities affect pricing given the current circumstance?
3.
When further thinking about the pricing pressure globally, in terms of the effect of the epidemic and on pork consumption, when do you think this issue might be resolved? You said there might be some underreporting of actual cases – how might this compare with China’s blue ear disease outbreak in 2006?
4.
Looking at the US and China dynamics right now, the trade and US production for China, do you there’ll be a pickup in Europe’s production and export to China? How could this reshuffle trade relationships?
5.
You said production has increased around 3% for growth annually. How much do you think production can rise in the next 3-5 years, can it really exceed what US processing capacity is today?
6.
You talked about biosecurity efforts and how to prevent African swine fever coming into North America, but what else can be done with regulations in China, looking at the industry and market structure?
7.
When looking at the impact of the swine fever on other protein pricing in the near term, so beyond pork pricing, when might it no longer have effect on the market?
8.
What’s the impact on the feed market, with soybeans and corn and so forth? If we consider what this means in China in terms of looking at the government's response and what can be done to keep feed costs low, the significance of pork to its CPI basket, the tariffs and adjacent categories, when will China have to return to the US? Do you think China will pay the tariffs to have the feed?
9.
Can African swine fever be transferred or passed via the animal feed?
10.
Do you have any further insight about the key players or companies in adjacent categories that have been impacted by the swine fever, maybe the processors or various players in the US? When looking at the shift to alternative proteins, are any other companies temporarily, or in the short-term, benefiting from this?
11.
What’s been the read-through in terms of restaurant pricing for pork in the US?
12.
Do you think the US hog farmers can increase their production quickly in response to the shortage? Can you elaborate on your earlier comment about excess processing capacity?
13.
When thinking about the global protein trade, the impact of the African swine fever epidemic and trade dynamics today, is there anything you'd like to highlight as key takeaways from our discussion?
14.
What’s your estimation on the potential additional volume from the US market when thinking about a market such as Korea? Circling back to the consequences or the impact on US farmers, would the additional volumes be enough to offset China’s volume that was coming from the US?
