- Meat companies have warned of potential shortages as coronavirus infects workers and shutters plants, but shipments overseas have skyrocketed, a Reuters analysis of government data found.
- Pork supplies dropped about 40% since mid-March in the U.S. because of closed plants, but pork shipments to China have more than quadrupled during the same time, according to USDA data. Roughly a third of all U.S. produced pork has reportedly been exported this year. Last week, China’s U.S. pork haul was the biggest in more than a year.
- China has bought more U.S. meat products because it is facing shortages because African swine fever killed half the country’s pigs in the last two years, Reuters reports.
The meat industry could face more scrutiny as supplies shrink for American consumers while exports keep flowing. As concern over the strained meat supply chain has escalated in the U.S., more meat going to China could further tighten product availability.
The increased exports come at a time when executives have warned of shortages because of plant closures. As coronavirus has spread among workers, infecting thousands and killing at least 20, more than 20 meat processing plants across the country — including some owned by China’s WH Group-owned Smithfield Foods — have closed or reduced production. Many in the U.S. have strongly criticized the industry’s response as waiting too long to implement safety precautions and close processing plants, but as supply has become a concern, the pressure to reopen plants and keep them running has escalated.
Kenneth Sullivan, CEO of Smithfield Foods, said in a statement after the shutdown of its largest pork facility that closing these plants “is pushing our country perilously close to the edge in terms of our meat supply.” John Tyson, chairman of Tyson Foods, similarly wrote in a letter published in major newspapers that until facilities can be reopened, the company could have a limited supply of its products available in grocery stores, and “the food supply chain is breaking.”
As concerns grew, President Donald Trump issued an executive order declaring meat plants “critical infrastructure” using the Defense Production Act to keep these facilities open and help prevent shortages. Labor unions and workers have criticized the move, saying it puts workers at risk. Industry has praised the order.
While plants have closed, pork farmers have had nowhere to send their animals, which is causing a crisis in the industry with an estimated $5 billion in losses in 2020. Chicken and hog farmers have been forced to euthanize animals. But if the processing plants are staying open to send the products they are able to process to China, then it could inhibit the main goal of Trump’s order: Keeping a “continued supply of protein for Americans.”
“That tragic outcome is all the worse when the food being processed is not going to our nation’s families,” Rep. Rosa DeLauro, a Democrat from Connecticut, told Reuters. “That is what the Defense Production Act is all about: protecting America’s national interests, not China’s.”
Trump is currently in a dispute with China over how it handled the outbreak, and more criticism could arise if the executive order he signed to keep U.S. meat cases stocked is helping countries abroad first.
Even before the coronavirus outbreak hit, pork producers were warning there could be potential shortages since Asian demand was increasing because of the swine fever outbreak, which has killed millions of hogs in China. As early as last October, pork producers were saying they would need to ramp up production to avoid shortages. That expectation has intensified with the pandemic. For the period from January to March, meat exports to China set a record, according to USDA.
A new report from CoBank found even if the reduced processing capacity at these U.S. meat plants is just short term, it will likely have a lasting impact on meat processors, producers, retailers and consumers in America. Meat supplies for grocery stores could drop 30% by Memorial Day, resulting in pork and beef price increases as high as 20% compared to last year, CoBank predicted.
If U.S. consumers see higher prices and less supplies, while exports continue to rise, the meat industry could face even more criticism in the future.