Christine McCracken, Animal Protein Analyst at Rabobank examines the pork industry in China. She estimates after the African Swine Flu (AFS) about 50% of China’s hog supply was lost. And prices in Asian markets have started gaining momentum in response, with around a 30% rise last month and almost doubling compared to last year’s price levels. One key reason for this is that since China imposes 62% tariff on US pork, it makes it difficult to resolve the supply scarcity immediately. This has also led to European and Brazilian markets being tapped to import pork aggressively.
Why does this matter? The pork industry can be used as a case in point on how damaging the escalating tariffs in the US-China Trade War can be for producers and consumer alike. The podcast also raises concerns on how higher inflation or more wide-ranging tariff hikes can be for both economies, magnifying such supply shocks.
(The commentary contained in the above article does not constitute an offer or a solicitation, or a recommendation to implement or liquidate an investment or to carry out any other transaction. It should not be used as a basis for any investment decision or other decision. Any investment decision should be based on appropriate professional advice specific to your needs.)
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