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China's Year of the Pricey Pig


The Chinese consumed 51 mln metric tons of pork in 2006""roughly half the world's total pig consumption.

"There is no such thing as zero risk. In terms of food safety, it's impossible for any country to make 100% of their foodstuffs safe," said Li Yuanping, director of China's General Administration of Quality Supervision, Inspection and Quarantine's import and export bureau.

That's Li's take on American recalls of Chinese products ranging from seafood to toothpaste to pre-packaged snacks found to be contaminated with industrial chemicals, carcinogens, and bacteria.

With annual exports to the U.S. valued at nearly $300 bln, China needs desperately to maintain the confidence of stateside consumers- 80% of which now have concerns about products made in China, according to a USAToday/Gallup poll.

Li wasn't quite as forgiving when the situation was reversed.

Last week, China suspended imports of pork and chicken from seven U.S. meat producers, including Tyson Foods (TSN), Sanderson Farms (SAFM), Smithfield Foods (SFD), and Cargill Meat Solutions, claiming to have found salmonella, feed additives and veterinary drugs in the meat.

Hey, wait! There's "no such thing as zero risk," right?

Uh, well…ummm…

Parr Rosson, an agricultural economist at Texas A&M University, says the Chinese appear to be "retaliating."

Right now, Porcine Reproductive and Respiratory Syndrome, also called "blue-ear disease," is sweeping across China.

Strange, his ears don't look blue…

The Ministry of Agriculture said that the disease could worsen due to unusually hot weather. The epidemic has spread through 25 provinces, sickening 143,221 hogs and killing 39,455 as of July 10.

According to a report by the United States Department of Agriculture, the Chinese consumed 51 mln metric tons of pork in 2006-roughly half the world's total pig consumption.

In a 36-city survey, China's Ministry of Commerce reported pork wholesale prices averaging 18.57 yuan ($2.45) per kilo on July 11, up nearly 30% from 14.25 yuan on May 11, and live pig prices were 71.3% higher in April than a year earlier.

Prime Minister Wen Jiabao told a crowd of supermarket shoppers in Shaanxi Province that "The government is going all out to ensure the supply of pork and keep it affordable," according to the Xinhua state news agency.

"The Chinese government is very sensitive to this," Hu Xingdou, a political analyst at the Beijing Institute of Technology told The Christian Science Monitor. "They are afraid that rising prices will affect social stability. They have not forgotten that inflation was an important reason for people to get involved in the events of 1989."

"The events of 1989" would be…Tiananmen Square.

Not something they'd like to repeat.

There are few choices.

One would be to follow the lead of certain cost-sensitive baozi vendors in Beijing's Chaoyang district, who soak cardboard in caustic soda-a chemical base used to manufacture paper and soap-then chop it into small pieces and fill steamed buns with a 60% cardboard/40% pork fat mixture.

"Pork" being made

Another would be for China to tap into its Strategic Pork Reserve.

I'm sorry, what was that?

Yep, the Strategic Pork Reserve.

Akin to the Strategic Petroleum Reserve in the U.S. that would keep those Chevy (GM) Suburbans on the road for about two months, China keeps a national reserve of approximately 1.65 million swine-8% of a 20 mln head shortfall.

It works out to about one hog for every 788 people. Not a whole lot of something the Chinese want very, very badly.

How badly?

The Shenzhen Jing newspaper reported that a peddler on a motorcycle was robbed at knifepoint while on his way to a market in Shenzhen with 275 pounds of pork.

"They took the pork because it was more expensive than the motorcycle," a policeman was quoted as saying.

A used motorcycle can be sold for about $132.

The pork?

More than $400.
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