Unlocking New Markets: How US-China Trade Disputes Boost Brazilian and European Food and Beverage Exports

Optimizing Trade Opportunities in the Food and Beverage Industry Amid Rising US-China Tensions

In the ever-evolving landscape of the global food and beverage industry, trade tensions between the US and China are creating a ripple effect that is reshaping supply chains and market dynamics. According to RaboResearch’s latest report, this development is opening up opportunities for other suppliers, particularly in the EU and Latin America, with Brazilian and European pork poised to benefit from the disruption in US-China trade.

Benefiting Suppliers: Brazilian and European Pork

• Pork prices have rebounded and remain strong despite shifting trade flows and economic uncertainties.
• Alternative suppliers like the EU, Chile, and Brazil are likely to benefit from the redirection of global trade volumes.
• Chinese importers reliant on US pork may face margin pressure, while US pork exporters could see weaker offal values.
• Heightened trade tensions could impact feedstocks, such as soymeal, potentially reducing feed costs for US pig producers.

  Industry Insight: Pork Price Rebound

• Tighter hog supplies, slow production response, and market uncertainty are driving the rebound in pork prices.
• Limited demand improvement is expected, with support from high beef and poultry prices and consumer spending shifts to retail.
• Potential export disruptions in the US and China, combined with economic pressures, may cap additional improvement.

  Industry Insight: Disease Challenges

• Herd health challenges like foot-and-mouth disease and African swine fever are constraining production in key regions.
• Outbreaks of FMD in the EU and ASF in Asia and Europe are leading to trade disruptions and production losses.
• Porcine reproductive and respiratory syndrome is also impacting pork production in North America and Europe.

  Industry Insight: South American Harvest

• A strong South American harvest and favorable planting progress for corn and oilseeds are driving feed cost tailwinds.
• Geopolitical disruptions are influencing global grain and oilseed trade dynamics.
• Larger grain supplies and rising stock levels are expected to keep feed costs manageable in the short term.

  Forward-Looking Outlook

• Investment in the US pork sector expansion is expected to slow amidst trade policy uncertainties.
• Other regions may experience slightly faster growth as alternative markets absorb exports at reduced prices.
• Geopolitical developments and weather-related uncertainties remain key risks in the industry.

  Industry Analysis

  The rising trade tensions between the US and China are reshaping the global food and beverage industry, creating opportunities for alternative suppliers like the EU and Latin America. Brazilian and European pork producers are poised to benefit from the disruption in US-China trade, with pork prices rebounding and remaining strong despite economic uncertainties. As trade flows redirect and global trade volumes shift, Chinese importers reliant on US pork may face margin pressure, while US exporters could see weaker values. The industry remains relatively well-balanced, with limited sow herd growth expected to constrain global pork supply. Disease challenges, geopolitical disruptions, and feed cost dynamics continue to influence market dynamics, presenting both challenges and opportunities for food and beverage professionals worldwide.