Buybacks have gotten a bad rap from both Republicans and Democrats. But stocks would be trading at a massive discount without them.Marketsread more
Fiat Chrysler and France's Renault could soon partner up to take on the sweeping changes to the global auto industry, according to a report in the Financial Times. The...Autosread more
Microsoft shares have gained 133% since November 2015, outperforming a tech "basket of unicorns" over that stretch.Technologyread more
The president's state visit comes amid tensions with carmaker Toyota over potential auto tariffs. Trump has repeatedly threatened Japanese and European carmakers with tariffs.Traderead more
The IRS is about to release a new draft of Form W-4, which will more closely reflect the changes stemming from the Tax Cuts and Jobs Act. For workers, that means they'll need...Personal Financeread more
When commercial real estate investor Manny Khoshbin spent $2.2 million on the fastest production car in the world, he had no idea it would very quickly also become the...Autosread more
The Mega Millions jackpot has spilled over $400 million. It would be the ninth largest winning since the game began in 2002.Personal Financeread more
Trump was speaking at a meeting of Japanese business leaders in Tokyo during his state visit to Japan on Saturday.Marketsread more
The biggest U.S. gasoline price surge in years is running out of steam just in time for the start of the summer driving season.Energyread more
The federal minimum wage has remained $7.25 per hour since 2009. But several states, and even some companies, have since taken matters into their own hands to pay employees a...Workread more
Stocks rose on Friday, but notched weekly losses as investors worried the U.S.-China trade war is hurting economic growth.US Marketsread more
Pork prices in China may soar by more than 70% by next year, as hog populations — ravaged by the African swine fever virus — plunge to "historically low" levels. Production levels could recover only by 2021 or later, experts say.
Meanwhile, the disease, deadly to pigs but not contagious to humans, has spread beyond China, the world's biggest producer of pork. It has hit Southeast Asia and parts of Europe, with the risk that the outbreak might spread, worsening global supply shortfalls, say experts.
That will drive up global pork prices, they say, although most could not provide estimates, citing China's lack of transparency or ability in providing accurate numbers of pig herds.
But in China, prices could hit a peak of 33 yuan ($4.90) per kilogram in January 2020, from the 18.5 yuan-per-kilogram price point in February this year, according to a prediction by Japanese bank Nomura. That would represent a roughly 78% jump.
That's on top of a surge of nearly 40% from a low in May 2018, explained Nomura in a recent report.
China had gone through three large swine disease outbreaks, or "hog cycles," before this, which saw pork prices surging. But this time, prices could be driven higher than ever before, said Nomura.
"Despite the rise in pork prices, pig farmers may be reluctant to increase hog stock on concerns about (African swine fever). In this regard, the upturn of the hog cycle could last longer and drive pork prices higher than in previous hog cycles," the bank said.
Nomura also referred to other major factors for its prediction, such as a falling hog-to-corn price ratio — indicating that feeding costs versus the price of a hog has become unprofitable — as well as the stock of breeding sows falling to "historically low levels."
With the declining stock in China weighing on global supply, U.S. hog prices could be driven up as well, said Mavis Hui, senior research director at DBS Bank in Hong Kong.
She pointed out that China's hog prices are now trading at about 11% above U.S. lean hog futures. The June lean hog futures contract on the Chicago Mercantile Exchange is up more than 70% since March 1.
The problem has been exacerbated by the trade war with U.S., with tariffs driving up prices of soybeans — used for animal feed — and leading Chinese farmers to slaughter costly breeding swine rather than risk forced culling, said research firm TS Lombard.
Since the discovery of the outbreak in August 2018, African swine fever has now spread to every province in mainland China for which pork is a staple. The country last week said it had culled over one million hogs in an effort to control the disease.
That number, however, is debatable — with upper end of estimates at 100 million, according to Rory Green, an economist at TS Lombard. Dutch bank Rabobank, on the other hand, put it at 200 million. That lack of reliable data in turn raises questions about its effect on global pork prices.
"The key question ... is what is the true severity of China's African Swine Fever (ASF) outbreak? And, actually no one, not even Beijing, knows the answer," Green said.
"Chinese authorities have actively downplayed the severity of the disease. Meanwhile small and medium sized farmers are incentivized to hide (African swine fever) outbreaks for fear of massive livestock and commercial losses. The result is an at best murky picture of the domestic pork market," he told CNBC.
What is clear, at least, is that the disease will have a "prolonged impact on China," TS Lombard said in a report last week. It forecast that Chinese swine stocks will only recover in late 2021 or beyond, while Rabobank and Nomura said rebuilding of pig stock may begin in 2020.
Rabobank added in an April report: "China's herd-rebuilding will be slow and take years."
China consumes about 28% of the world's meat, including half the global supply of pork. So, with the growing deficit, Rabobank said it expects available global protein supplies to be redirected to China — not just pork.
That could also send prices of other meats up, according to experts.
"This unprecedented shift in trade will likely create unexpected product shortfalls in markets previously served by these suppliers, creating short-term market volatility that will ultimately result in higher global protein prices," said Rabobank.
TS Lombard's Green warned: "The size of China's herd and the amount of pork consumed mean that even a 14% fall would send the global pork market into a marginal supply deficit." He referred to U.S. Department of Agriculture estimates of a 13% drop in China's pork production and a rise in its share of global pork imports from 14.5% to 22% this year.
Calling those estimates "overly conservative," Green told CNBC his own firm's estimates were that the country's pork production could fall by more than 20%, and pork imports could rise more than 40%.
"This is why (Chicago Mercantile Exchange) futures have been rallying so strongly and why there is the potential for a global 'protein price spiral', as Chinese consumers buy more beef and chicken to offset falling pork consumption," Green said.
Aside from China, the disease has spread in Europe, and elsewhere in the Asia Pacific region such as Japan, Australia and parts of Southeast Asia.
In Vietnam, production losses are expected to exceed 10 percent, according to Rabobank.
The disease has also broken out in Cambodia and could move further into Southeast Asia, with more losses set to follow, the bank said.
"Vietnam's close proximity to Thailand is a concern. Although no (African swine fever) outbreak has been detected in Thailand, it is considered a high risk country," he said, in an email to CNBC.
Southeast Asia appears ill-equipped to deal with such a disease outbreak, the experts said, adding that the region will have difficulty re-populating pig herds — piling on further pressure to global protein markets.