Brett Stuart, president of Global AgriTrends, speaks to ThePigSite's Sarah Mikesell about global trends in the swine industry at World Pork Expo in Des Moines, Iowa, USA.

"China’s hog market has cycled, and they are having very tight supplies, driving their hog prices to all-time record highs," said Stuart. "Those high Chinese hog prices are now double the price of US hogs, which is incredible when you think of half the hogs in the world now priced double the US prices. When that happens, imports become a component for China."

China produces 98 per cent of their own pork, but the 2 per cent that they import represents roughly 2 to 3 million tons of pork, creating a market that is red-hot, he said.

"China is scouring the world to try and gather pork supplies to offset their overheated market. As a result, we’re seeing a lot of European pork going to China," he noted. "It’s coincidental, but very fortuitous for Europeans who have been in an oversupply situation since the 2014 Russian ban on European pork. That banned 400,000 tons of European pork, so this opening in China is a natural fit."

European pork now represents about 67 per cent of all the pork going into China. The US is selling pork to China as well, but at a slimmer rate. The Chinese government has some restrictions on feed additives that the US uses which is limiting trade, but the US is shipping 55 to 65 million pounds of pork a month to China, he reported.

"It’s important to understand that [the Chinese] market is pulling all available supplies today - Canadian supplies, European supplies, US supplies, even Brazilian supplies, but Chinese hog farmers - you got to make sure you realize this - are making enormous profits. Profits today are over $150 a head," Stuart said. "That level of profit will drive expansion in China. There’s no way around it. The money is too good, and so as those farmers in China begin to expand, but it takes time. It probably takes longer than it does in North America, but additional production will hit that market."

Looking to 2017, Stuart expressed concerns that the market will hit a tipping point.

"As we see additional production come on the market, those prices could drop. Demand for imported pork will likely fall from China in 2017," he suggested. "That’s important because we have a lot of EU pork in the market, a lot of Canadian pork and that pork has got to go somewhere. Unfortunately, that’s going to coincide with the larger US production in 2017, and so we’re in a bit of a spot where there’s a bit of a caution flag into 2017."