A Chinese state-backed entity will auction 10,000 tons of frozen pork from its reserves on Thursday because of an outbreak of swine fever, reported BBC.
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More than 1 million pigs have had to be slaughtered because of the outbreak, hurting the Chinese pork industry and consumers. China’s hog prices have gone up 130% since January according to Zhue, a Chinese industry website that tracks Chinese hog prices.
The frozen pork at auction comes from countries including Denmark, France and the U.S., according to BBC. Purchases will be capped at 300 tons per bidder.
|TSN||TYSON FOODS INC.||79.17||-1.80||-2.22%|
Stocks for pork-related companies had a mixed response to the news. Hormel was above its previous close as of noon Thursday, while Tyson was below.
The auction will occur shortly before China starts its weeklong celebration of the People's Republic of China 70th anniversary. Pork is an important staple of Chinese festivals.
Humans are not affected by the swine disease.
China's pork crisis comes as trade tensions between the country and the U.S. continue. U.S. soybeans and pork, in addition to some other farm products, will be exempt from additional tariff hikes, easing tensions between the two sides ahead of trade negotiations in October, the Chinese state news agency, Xinhua News Agency, recently announced.
The move will be a welcome relief to U.S. hog farmers and pork producers. China was the third-largest export market for U.S. pork in 2018, following Japan and Mexico. However, the value of pork exports declined to $852 million that year, from $1.1 billion in 2017 -- before the Chinese tariffs were enacted according to data from the U.S. Meat Export Federation.
FOX Business' Daniella Genovese contributed to this report.