Lower feed prices should allow Europe’s pig sector to cope with declining pigmeat prices and to achieve a projected 0.8% production recovery in 2015, according to the latest “short term outlook” report from the European Commission (EC).
This is despite the impact of the Russian ban on pigmeat imports, which was imposed earlier this year, and the additional broader Russian food imports ban which is now in place.
Despite noting that the ban imposed in February this year “slightly delayed the recovery in pigmeat production” in the EU, the report still takes a generally optimistic view of the future, stating that 2014 EU pig meat exports are expected to decline by just 8% compared to 2013.
Although the Russian market previously accounted for a quarter of total extra-EU pigmeat exports, the EC believes that the volumes initially destined for Russia can be “expected to be absorbed by some growing Asian markets, such as the Philippines, South Korea or Japan.
The EC analysis, based on figures collected up to September 15, 2104, also leads to the conclusion that EU pigmeat exports can be expected to “remain stable” in 2015. This view is founded on strong demand from “our Asian partners”, resulting in “price competitiveness” continuing next year.
“In addition,” it is stated, “new outlets could appear, for example, Vietnam, which recently opened the market for fresh and frozen pork, although this would depend on the time needed for logistics and certifications.
“Moreover, trade diversion of Brazilian meat towards Russia could leave room for EU exports to the usual export destinations of Brazil. In order to secure the supply of pigmeat, Russia has authorised several Brazilian companies in an attempt to find substitutes for pigmeat imports from the EU, and has been searching other suppliers (such as Chile, Argentina, Ecuador and China) for additional quantities of beef, pig and poultry meat.”
There is also a display of optimism on pigmeat consumption, moving into next year.
“Whilst in 2014, pigmeat consumption is expected to be stable at 2013 low levels (31 kg/capita in retail weight), consumption is expected to resume growth in 2015, together with higher availability on the EU market and better prospects of economic growth,” it is stated.