Animal feed, vaccine share soar after ASF outbreak
Shares of animal feed makers and vaccine producers soared Tuesday after the country’s first case of the highly contagious African swine fever (ASF) was reported north of Seoul.
According to securities analysts, animal feed makers can benefit from the disease as using human food waste to feed pigs is the main cause of the spread of the highly contagious virus. Also, vaccine producers are expected to take advantage as the government will improve quarantine efforts to restrict the spread of the virus.
The agriculture ministry announced in the early morning that the first case of the animal disease was confirmed in Paju, Gyeonggi Province, close to the inter-Korean border. The disease is known to have no cure and no vaccine; pigs that contract the virus have a mortality rate of 100 percent.
The highly contagious disease has already devastated the hog-raising industry in some 20 countries across the world including China, Vietnam, North Korea and Philippines.
To prevent the spread of the highly contagious virus, some 4,000 pigs at hog farms in the region will be culled by Tuesday, according to the ministry.
Major animal feed makers such as Hyundai Feed, Woosung Feed and Hanil Feed saw their shares increase by between 15 percent and 30 percent.
Hyundai Feed shares closed at 19,450 won ($16.35), up 15.77 percent from a day earlier while Woosung Feed shares soared by 29.73 percent to 4,320 won and Hanil Feed shares increased by 23.28 percent to 2,330 won.
Shares of vaccine makers such as Daesung Microbiological Labs, CTC Bio and Komipharm also increased by 29.91 percent, 17.15 percent and 7.03 percent respectively.
Poultry processing companies such as Harim, Maniker F&G and Cherrybro are also benefiting from the infection, witnessing their shares rise.
Harim shares closed at 3,665 won, up 29.96 percent from a day earlier. On the same day, Maniker’s shares increased by 29.87 percent to 1,100 won and Cherrybro saw a 20.55 percent increase to close at 4,400 won.
Park Ae-ran, a researcher at KB Securities, said “the disease occurred near the inter-Korean border and will likely have a limited impact on the country’s pork industry but the situation still needs to be monitored as the incubation period of African swine fever is about two weeks.”
Thick cuts of pork belly are displayed at a discount store in Seoul, Tuesday.