ThePigSite.com - news, features, articles and disease information for the swine industry

AHDB European Market Survey


12 March 2012

AHDB European Market Survey - 9 March 2012AHDB European Market Survey - 9 March 2012

In Russia steady consumer demand and domestic production constraints have contributed to ongoing high demand for imported red meat.

AHDB

Growth in EU pig meat exports

There was considerable growth in the EU pork export trade in 2011. This was facilitated by an increase in domestic production of around two per cent and subdued EU demand. In addition, there has been strong demand on the global market, particularly from the Far East, as disease problems there have led to reduced production and so an increasing import demand. The weak euro also contributed to competitive EU prices compared with both North and South American exporting countries. Not only were there increased exports of fresh and frozen pork but also lower valued cuts, especially offals.

EU exports of fresh and frozen pork to third countries increased by 26 per cent in 2011 compared with a year earlier, a similar level of growth to that recorded in 2010. Around 90 per cent of product was in frozen form. The overall average export price in 2011 was up five per cent. Most Member States increased their exports to non-EU markets with Denmark and Germany remaining the largest contributors, accounting for 24 per cent and 22 per cent of the total. The EU’s two main export markets, Russia and Japan, both experienced an increase in trade. Exports to Russia increased by 16 per cent to 355,000 tonnes, as African swine fever continues to be problematic in the country, while consumer demand was strong. Shipments to the premium Japanese market were up by four per cent. The largest growth was seen in EU exports to the Far East. South Korea overtook Hong Kong as the third largest export market, with shipments up 91 per cent year on year to over 193,000 tonnes, due to lower domestic supply on the back of the FMD outbreak there. There were also sharp rises in shipments to China and Hong Kong.

Pig offal exports to third countries increased by 24 per cent in 2011 compared with 2010 to over one million tonnes, of which Hong Kong, China and Russia were the main markets. EU shipments of pig fat increased marginally year on year with the main destination being Russia, which accounted for 71 per cent of EU trade.

Although much smaller in terms of volume traded, EU exports of processed pig meat, including bacon and sausages, also increased year on year. Russia and the US continue to be key destinations for processed pig meat. EU sausage exports were up 19 per cent compared with 2010, with the largest growth being in increased shipments to Angola. Exports of processed hams and shoulders were up 24 per cent and bacon was up 11 per cent.

In contrast, while remaining substantial exports of live pigs from the EU declined by three per cent in 2011 to 1.6 million head. More than 80 per cent of this trade was with Russia and Croatia.

Contrasting trends in Russian beef and pork imports

In Russia steady consumer demand and domestic production constraints have contributed to ongoing high demand for imported red meat. However, because of problems for some supplying countries, notably Brazil, and Russian quotas pork imports in 2011 showed only a two per cent growth while beef and veal imports were down four per cent.

For beef and veal, strong global demand coupled with supply shortages contributed to the fall in imports while the average import price in 2011 was up 16 per cent year on year in US dollars. For EU suppliers the average import price was up 22 per cent, which contributed to the stability in its trade, with a fall for Germany offset by growth for Lithuania and Ireland. Brazilian product was also less competitive and shipments were down 21 per cent given domestic shortages, although it remained the largest supplier to Russia with a 37 per cent market share. In contrast, there was a marked growth for Australia and the US while Mexico also emerged as a significant supplier in 2011 shipping 22.500 tonnes. However, Argentina lost further ground.

The small rise in fresh and frozen pork imports in 2011 reflected better global supply availability and a somewhat smaller price rise compared to beef of seven per cent in US dollar. Also supplies of Russian pig meat were higher in 2011 as production was up an estimated five per cent.

For imported product, the volume increase occurred despite the disruption in supplies from Brazil with its shipments down 41 per cent even though the price rise only averaged two per cent. Brazil remained the largest individual country supplier with a 20 per cent market share. However, from September onwards shipments only averaged 3,000 tonnes per month as the ban on supplies from processing plants in three states took hold. Canada, in particular has emerged as a major supplier to the Russian market with shipments up by two thirds. Imports from the EU showed a less marked rise of 17 per cent and while shipments from Germany were marginally lower this was more than offset by a large rise for Spain. There was also modest growth for Denmark and the smaller suppliers of Ireland and the Netherlands.

Russian fresh and frozen pork imports in 2012 will be constrained by the reduction in the tariff quota (TRQ) to 400,000 tonnes compared with 472,100 tonnes in 2011. For fresh and frozen beef it is unchanged at 560,000 tonne. Russia is due to ratify its WTO membership (see EMS11/50) by mid-2012 but it is not clear as to what TRQs will apply.

DOWNLOAD REPORT:- Download this report here

Our Sponsors

Partners


Seasonal Picks

The Commuter Pig Keeper - 5m Books