— This is the script of CNBC's news report for China's CCTV on September 14, 2020, Monday.
After Germany confirmed its first case of African swine fever, local authorities quickly took precautions, putting up protective fences around the so-called core area within three kilometers of area.
To prohibit entering, exiting and agricultural income activities. The so-called "dangerous zone" of 15 kilometers and the "buffer area" of 30 kilometers have also been established. However, there are fears that cases could have been weeks, as the pigs' bodies were decomposing when they were found. What worse is that one pig farmer is reported to be in the core zone and 17 others are in the dangerous zone, raising concerns about the possibility of wider spread.
Germany is one the major pork exporters. Currently, it related government departments are trying to negotiate to keep trade. But given the uncertainty, South Korea and China have banned pork imports, a big blow to the German agricultural market.
Germany exports about 1 billion euros worth of pork to China each year, accounting for 25 percent of the European pork exports. If exports to South Korea and China are banned, the surplus could flood into other European countries. While stronger exports from safer countries such as the U.K., could offset some of the impact, there are concerns it could still push down pork prices in the European market. On the other hand, the ban may also benefit other pork exporters, such as the United States, Canada and Brazil, as potential alternative markets.
Us lean hog futures rose for the second day in a row following the German case.
Now, the situation in Germany is still in its early stages, and the National Pig Association says the situation is very worrying, and they want Germany to act quickly. If needed, Germany will also carry out the necessary boar hunts. The association also notes that it may take at least two years for the so-called ASF-free certification to resume after a case occurs, meaning that the effects may last for some time. Another concern is the risk of spread of ASF within Europe.
The German case is presumed to have been introduced from neighboring Poland. Before that several European countries reported cases or outbreaks of African swine fever. The European Food Safety Agency has also pointed out that the European Union's areas affected by African swine fever are "gradually expanding", especially the spread of the plague caused by the migration of wild boars like this time in Germany.
We will keep an eye on this issue.