What’s up with agricultural commodities? Prices!
According to many analysts, the current high grain and oilseed prices are likely to remain for the foreseeable future. Here are a few of the reasons why …
In other news
The European Union (EU) may lift the ‘feed ban’
In the 1990s, bovine spongiform encephalitis (BSE) caused a major scare and the European Commission and Parliament subsequently prohibited the use processed animal proteins (PAP) and meat and bone meal (MBM) in animal feed. Since 2010, however, regular calls have been heard to loosen the restrictions in order allow feed producers to utilise a valuable protein source. The relatively high cost of soybean meal in recent times is not mentioned, but surely must have played a role in encouraging lawmakers to give serious consideration to the matter.
Bird flu in Ekurhuleni
An outbreak of highly pathogenic avian influenza (AI), or bird flu, was reported on a commercial layer farm near Ekurhuleni in mid-April. According to the Department of Agriculture, Land Reform and Rural Development (DALRRD), the farm was also affected by the widespread outbreak of H5N8 in 2017. A total of 300 birds died in the latest outbreak, while the remaining birds in the same house were destroyed and the farm quarantined. Botswana has subsequently banned the import of all poultry products from South Africa, with immediate effect, while other neighbouring countries had not responded yet at the time of writing. Other outbreaks around the world have also been reported recently, with Bulgaria being the most affected. Six outbreaks have been reported since the start of the year, which has already led to almost 500 000 layers and ducks being culled.
Chinese pork output rebounds, but profits plunge
Chinese pork output rose by nearly 32% in the first quarter of 2021 compared to a year earlier and reached 13,69 million tonnes. The national pig herd also showed promising growth during the period reaching 416 million head, up from 406 million reported in the fourth quarter of 2020. Major investments by pork producers have helped the recovery of Chinese pork production after the widespread devastation caused by African swine fever (ASF) from 2018 to 2020. However, the threat is not over yet and various outbreaks have been reported over the winter months. Many analysts outside China have questioned the official reports that outbreaks are limited in scope and under control, but looking at indirect indicators, such as domestic pork prices and soybean and pork imports, it seems to be the case. Pork prices plunged more than 40% over the period, while soybean imports from the US increased dramatically, especially given weather-related delays in shipments from Brazil. The Chinese government has recently announced a plan to reduce the risk of spreading the disease. According to the proposal, China will be divided into five regions. Each region shall be responsible for monitoring and managing outbreaks. No animals will be allowed to cross between regions, except for breeding animals and piglets. Slaughter animals must be processed in the same region. The system was piloted in six southern provinces and seems to have been moderately successful in curbing outbreaks.