Monday, April 23, 2012

China buying more U.S. breeding hogs, but critics fear long-term decline of pork export market

In order to keep up with increasing demand for a protein-rich diet, China is buying millions of hogs raised in the U.S. as breeding stock and capitalizing on decades of U.S. agricultural research, P.J. Huffstutter and Niu Shuping of Reuters report. Americans are eating the least meat in 20 years, but the Chinese are eating almost 10 percent more than five years ago and pork is a staple of their diet. U.S. experts say China's purchases will shift its small-scale, backyard farm culture to large, consolidated operations to keep up with demand.

The U.S. exported $644 million worth of breeding livestock and genetic material in 2011, an 82 percent jump in two years, but concerns are being raised. While U.S. consumption falls, the price of producing protein is rising, which shrinks producers' profit margins.

Some critics say the short-term gains of exporting breeding stock will mean long-term loss of a key export market for producers because China has a history of importing technologies, apply them cheaper and emerge as "an aggressive competitor in the global market," report Huffstutter and Shuping.

China isn't the only country taking advantage of breeding exports. Russia and Turkey bought the most U.S. breeding exports last year. But, China was the biggest buyer by volume, with about 14 percent of all U.S. live animals were sent there. Huffstutter and Shuping report the impact of the market in China would have a great global impact. (Read more)

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