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Weekly Overview: Attention Focuses on Global Water Situation and ASF

17 September 2012, at 11:20pm

ANALYSIS - The global water situation has been described as a crisis in a new report from a high-level group of politicians and experts. To quote just one staggering figure from the report, global agriculture alone will require the flow of 20 Nile Rivers every year to feed the one billion more mouths worldwide by 2025. A new study by FAO raises concerns about the spread of African Swine Fever (ASF) as new outbreaks are reported in Russia.

Every day for the last few months, we have been receiving reports from around the world about 'weather events' and their impacts on feed prices that are so important to the sustainability of the pig industry.

In the last week, the global water situation is being described as a crisis.

The world today faces a water crisis with critical implications for peace, political stability and economic development, experts warn in a new report issued jointly by the InterAction Council (IAC), a group of 40 prominent former government leaders and heads of state, United Nations University, and Canada's Walter and Duncan Gordon Foundation.

"The future political impact of water scarcity may be devastating," says former Canadian Prime Minister and IAC co-chair, Jean Chrétien. "Using water the way we have in the past simply will not sustain humanity in the future. The IAC is calling on the United Nations Security Council to recognise water as one of the top security concerns facing the global community.

"Starting to manage water resources more effectively and efficiently now will enable humanity to better respond to today's problems and to the surprises and troubles we can expect in a warming world."

A few mind-boggling facts from the report: approximately 3,800 cubic kilometres of fresh water is extracted from aquatic ecosystems globally every year. With about one billion more mouths to feed worldwide by 2025, global agriculture alone will require another 1,000 cubic kilometres (one trillion cubic metres) of water per year - equal to the annual flow of 20 Niles or 100 Colorado Rivers. It is expected that water demand in India and China alone – the world's two most populous countries – will exceed supplies in less than 20 years.

Turning to news from the markets, pig prices in Europe have risen to historical records this summer, and continue to climb, according to Javier Santamartina, Genesus Rep for Spain, Portugal and Italy. He demonstrates that this price development is quite different from the pattern of the last two years, which he attributes to escalating feed prices.

Mixed fortunes have been reported for some of the leading pig meat companies. In Canada, Saskatchewan's largest pork producer, Big Sky Farms, is in receivership and may be sold.

In Russia, integrated and diversified meat producer, Cherkizovo Group, saw revenues increased by 16 per cent on a ruble currency basis in the first half of the year.

On its pig meat sector, Sergey Mikhailov, Chief Executive Officer of Cherkizovo, commented: "We continue to benefit from high pork prices, caused by the deficit from African Swine Fever in some regions of Russia and a veterinary ban on imports of live pigs. We expect prices to remain relatively high for the remainder of the year.

Continuing on African Swine Fever (ASF), the FAO has produced a new report on the current status of the disease across the world. Its authors describe the dynamics of its spread as 'worrisome' and warn that the steady spread towards unaffected areas could have a disastrous impact. New ASF outbreaks have been reported in the last week in the regions of Kuban and Tver.

Finally, a new outbreak of foot and mouth disease involving pigs has been reported in China.