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EC forecasts continuing “strong demand” from Asia for European pigmeat

PW ReportersBy PW ReportersMarch 10, 20152 Mins Read
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Pigmeat production is expected to “recover” in the EU though 2015 and 2016, supported by lower feed prices and increased productivity, according to the latest short-term agricultural market outlook published by the European Commission (EC).

While acknowledging that this forecast is “despite low output prices”, the report concludes that a higher pig herd and increased productivity, following the implementation of welfare rules in the sow sector, should “create conditions for a continuous recovery in production over the projection period (2015/16) at around 23 million tonnes.

On the issue of how much EU pigmeat exports have been affected by the 2014 Russian bans, attention is focused on the rising importance of Asian markets.

“In 2014, Russia accounted for a mere 3% of EU pig meat exports compared to 33% a year earlier,” it is stated.  “Strong demand from the Asian markets, particularly from Japan (totalling 345 000 tonnes), South Korea (199 000 tonnes), Hong-Kong (125 000 tonnes) and Philippines (122 000 tonnes) did not fully compensate for the loss of the Russian market.

“However, prospects of higher pigmeat supplies and strong demand from Asia could support a recovery so that exports could reach the 2012 level by 2016 (2.1 million tonnes).”

Finally, on prices, the report adds:  “Despite a sustained recovery in consumption, the strong drop in EU exports and increased supply on the domestic market drove pigmeat prices below their 2007-11 average, at 133 EUR/100 kg (£95/100 kg) during the last week of 2014.  However, on February 24, 2015, the EC announced the opening of a private storage aid scheme for pigmeat to stimulate pig prices recovering faster and to stabilise producer margins.”

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