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Moody’s Affiliate Says High Pork Prices Risk Complicating Asia-Pacific Recovery

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AKP Phnom Penh, April 01, 2021 --

Moody’s Analytics is warning that a second wave of African swine fever could destabilise the agricultural sector in Asia-Pacific countries.

In a report received from Hong Kong Thursday, the affiliate of U.S. credit rating agency Moody’s Investors Service said new cases had been detected in several parts of China since the second half of last year.

The report said the disease had also resurfaced in many other parts of Asia — including the Philippines, Malaysia and Indonesia — and that variants were harder to detect.

“A possible second full wave of African swine fever threatens to destabilise the agricultural industries in China and the Asia-Pacific region,” the report said.

Moody’s Analytics economist Xu Xiao Chun noted that African swine fever caused pork prices in China to double in 2020 because of high demand and low substitutability.

“Pork prices stopped rising by the fourth quarter of 2020,” he said. “But pork (and overall meat) prices remain volatile at historical highs.”

Xu said Chinese authorities were aiming to stablilise supplies and consolidate the pig market through financial support and investment in scientific research and technical services to strengthen biosecurity.

“But pork import volumes have remained elevated while piglet prices, a forward indicator of general pork prices, have risen in recent months,” the economist said.

According to Xu, outbreaks in the Philippines caused pig farmers to lose 15 percent of their inventory, raising inflation to 4.7 percent in February.

“To help stabilise prices in the Philippines, the pork import cap was increased to allow for more pork supply to be imported under a lower than usual tariff rate.

“These issues can easily be replicated in other production centres in Asia, but if they do happen, they will complicate the region’s recovery path,” Xu said.

In 2019, the Food and Agriculture Organization of the United Nations (FAO) sent an emergency response team to Cambodia after an outbreak of the virus in Rattanakiri.

The mission from May 27-31 advised the Ministry of Agriculture, Forestry and Fisheries on prevention measures, effective biosecurity and clear messaging to keep the public informed.

The FAO stressed at the time that the virus did not pose a human health risk as it only infected pigs.

“The virus is very stable, survives for a long time outside the host and can spread easily among the pig population,” it said.

“The virus can also survive for long periods in preserved pork products (salted, dried or cured) and feeding swill can spread the virus to non-infected pigs.”

In the absence of an effective vaccine or cure, “the disease is controlled through culling of infected animals, strict border and movement control, proper biosecurity measures and preventative action,” the FAO said.

By Sao Da