Rising consumer confidence, the lowest pig production costs for four years and the role of emerging markets in helping EU producers cope without access to Russian buyers, are all highlighted as key factors by BPEX as the industry approaches 2015.
Analysing the various often dramatic changes of 2014 in the December edition of Pig Market Trends (PMT), BPEX commented that the UK economy is now definitely “picking up speed”, with GDP growth, low inflation and falling unemployment all helping to create a more promising consumer environment going forward. Despite the upturn in the economy, however, the end of year summary is still distinctly cautious.
There is also a clear positive attached to the fact that the estimated average cost of pig production during the third quarter of 2014 was the lowest since 2010. Since then, however, pig prices have continued to fall while feed prices have started to rise again, leaving BPEX with the view that many producers are now “likely to be close to their break-even point”.
As for the obvious 2014 success of EU pork exporters, in substantially overcoming the loss of the Russian market, the big remaining question for 2015 is how sustainable the new-found market outlets may be in the weeks and months ahead.