Global context

NEWS BITES

Global context

CHINA EASES ZERO-COVID POLICIES

China spent December rapidly unwinding what had been the strictest anti-Covid regime of any major nation. These policies, particularly the widespread lockdowns, had been burdensome for both personal freedom and economic production (in the animal nutrition sector, valine and tryptophan had been among the products most recently affected). However, the wave of infections following this dramatic policy U-turn is having its own impacts on industrial activity.

BRAZILIAN ELECTIONS RETURN LULA TO POWER

Luiz Inacio Lula da Silva (Lula) defeated Jair Bolsonaro in the runoff for the Brazilian presidency. Bolsonaro supporters protested, causing delays at ports and on highways which affected the transportation of agri-commodities. The Lula administration plans to make protection of fragile ecosystems like the Amazon and the Cerrado a priority, an objective which may push it into conflict with agribusiness interests such as soy and beef production.

BLACK SEA EXPORTS CONTINUE, BUT SLOWLY

In late November, warring parties Russia and Ukraine agreed to a renewal of the deal brokered by the United Nations and Türkiye to allow shipments of grains and foodstuffs out of ports in the Black Sea. However, for the months when the deal was in place, Ukraine’s exports of grains were still 40% lower than the same period last year. According to Reuters, those ports which are included in this deal are still not exporting at capacity, with Ukraine blaming Russia for slowing the inspections process. The Black Sea export situation has been a major factor in worldwide grains prices since the war began in February.

HIGH PATHOGENICITY AVIAN INFLUENZA REACHES SOUTH AMERICA; SETS RECORDS ELSEWHERE

Since October, outbreaks of HPAI have been detected in northern South America, beginning with wild birds in Colombia; at the point of publication, outbreaks had also been declared in Peru, Venezuela, Chile, and Ecuador, including in domestic poultry in some cases. These mark the first instances of HPAI in South America in 20 years.

Indeed, the HPAI situation has been particularly bad in many areas recently. In the US, the number of poultry deaths from avian influenza or from related culling in 2022 have broken records, and Europe is experiencing its largest-ever HPAI epidemic as well. Egg prices in both the US and Europe reached record highs in the quarter. And there are concerns about the virus becoming endemic in new parts of the globe and/or persisting in seasons when it has traditionally retreated.

U.S. FEDERAL GOVERNMENT SEEKING REFORM OF POULTRY TOURNAMENT SYSTEM

The U.S. Justice Department launched a civil investigation into the contracts and payment practices between chicken companies and the farmers who grow birds for them, according to reporting in the Wall Street Journal, citing a regulatory filing.

This is one of a number of actions the federal government has taken to address the balance of power between these two parts of the value chain; as Feedinfo has reported on, the U.S. Department of Agriculture’s ARS is also looking to address concerns about transparency in poultry tournament systems and retaliation or discrimination on the part of meatpackers using rulemaking under the Packers & Stockyards Act.

CLIMATE CHANGE CONFERENCE FOCUSES ATTENTION ON AGRICULTURE’S GHG FOOTPRINT

Around the UN’s COP27 climate change summit, the European Union agreed to include agriculture in national targets for emissions reductions, and China has included agriculture in its action plan on methane. Moreover, an official from the Food and Agriculture Organization reportedly told Reuters at the conference that in the next year, the UN body will be launching a plan for bringing agriculture and food production in line with global goals on emissions reduction.

Meanwhile, the UN’s COP15 biodiversity conference in December prompted the EU to announce its new regulation on deforestation in certain supply chains, including soy; read more about this on pages 18-20.