The top chart below shows calculations of China's per capita consumption of pork, poultry, and beef, based on USDA carcass weight data in the Department's international PSD database. Pork is China's favorite meat by far, and the latest issue of PSD (July-2016) shows a decline in pork usage per capita for 2015 and 2016.
The question is why?
Are there (perhaps temporary) production problems, such as the inability of hog producers to obtain production credit? Will these difficulties soon be overcome, sending the series back up (later in 2016 or in 2017)?
Or are there (perhaps new) demand side problems, such as slowing urban incomes or changing relationships in the distribution chain from feeders to retail, with different players obtaining larger shares of the final consumer prices actually paid? Is the "per capita glitch" a signal of nothing more than the gradual evolution of China to a consumerist economy, made a bit more awkward by the (diminishing) bureaucratic control of the China Communist Party (CCP)?
The second chart below displays China's per capita pork consumption versus other other major world regions, including the US, the EU-28, the Former Soviet Union (FSU-12), South America, Southeast Asia, and the rest of the World. China's per capita pork usage has doubled since 1990, and in 2014 surpassed the EU-28's leading position. The chart also makes it clear that "two-year "glitches" are not uncommon.
The bottom chart displays China's and the other region's per capita usage of all three main types of meat together--pork, beef, and poultry--with China in the middle of the pack.
An important long-term question is this: In a very general sense, even if the current pork "glitch" disappears, should we really expect China by 2030 to have similar total meat consumption at a similar level to Europe and South America?
I'm not sure, of course, but my opinion looking at this chart is that such a strong continuing growth would be a real stretch!
Also, focusing back on the question of China's whole soybean imports, what about the argument that it's not just meal for meat that's the driver, but the need for more and more (imported) vegetable oil for cooking the meat, and other foods? We'll address that in the next Note.
Please keep the emails coming in, they're terrific, and I'll be trying to address them all--if not in this series of Notes, surely at the August 18-19 Seminar itself.
