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Rabobank forecasts “below break-even” prices for EU pigmeat in 2015

PW ReportersBy PW ReportersApril 20, 20152 Mins Read
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Increasing pork sector competition in the global export market will result in continuous price and margin pressures in most countries this year according to the latest pork quarterly report from Rabobank.

“After the buoyant (at least price-wise) last couple of years, the global pork industry is slowly moving towards the bottom of the cycle,” said Rabobank’s animal protein analyst, Albert Vernooij, adding that, as a result, EU prices could be expected to remain “below break-even level” in 2015.

“Further pressure will come from the fact that feed costs are expected to stabilise around current levels, with wheat prices neutral to slightly bullish, corn prices still neutral and a bearish outlook for soya.”

In looking at the different global markets, he said that in the US, as supply recovers after PEDv, the question is to what degree recovery will be coupled with the strengthening US dollar and lower prices.

“The much lower than expected impact (of PEDv) at present will encourage production recovery,” he said.  “This will continue to challenge prices, together with difficult exports due to the strengthening of the US dollar.”

For the EU he said that prospects remain “meagre” due to higher production and lack lustre demand, limiting the seasonal improvement of pork prices to, at best, the average seasonal level.

The Rabobank view on China was a bit more upbeat, however, with Mr Vernooij saying he expected that a rise in pork prices, showing through in the second half of 2015, would “offer opportunities” for import growth in that market later in the year. 

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Previous ArticlePeter Crichton’s commentary for April 17, 2015
Next Article Commitment to British pork holds firm with major supermarkets
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