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AHDB Pork Weekly Export Bulletin


24 March 2014

BPEX Export Bulletin - Week 12BPEX Export Bulletin - Week 12

The effects of the Russian pig meat ban are multiple. For European producers, the loss of its largest market has led to price falls (17% since January in Poland and Lithuania) and hardship in the Baltics and Poland whose producers rely most on the Russian market and see other markets closed as well.
British Pig Executive Weekly Export Bulletin

Bulgaria and Romania have also suffered major price falls. However, a resumption of exports from Spain, Italy, France, Belgium, Denmark, Netherlands and Sweden seems possible over the next few weeks.

Meanwhile, Russian consumers are taking the brunt of the rise of pork raw material for the making of sausages of about 70% and serious financial difficulties for the secondary processors. The conjunction of the devaluation of the rouble and the import ban mean a rise of retail prices of sausages of the order of 40%. Indeed, the winners are the large Russian producers who are also benefiting from lower feed prices thanks to the good harvest in 2013. They are now registering record profits. However, with African Swine Fever rampant in Eastern Europe, it is doubtful that this in itself will revive the stagnant Russian pork production. The European Commission failure in getting Rosselkhoznadzor to accept regionalisation has left it weaker as individual countries have now seized the initiative in negotiations. However, the meeting between Rosselkhoznadzor and Spanish authorities in Madrid last Friday did not conclude satisfactorily (see below).

Resourceful European exporters are now turning their attention to North American as the PEDv crisis is hitting supplies hard, leading to record high prices, much higher than EU prices (see more below).

Denmark

Record weaner exports forecast for 2014

The number of weaners exported could reach 10m in 2014 according to Danish Agriculture and Food Council (DAFC). Slaughter pig output could fall by 200,000 to 18.9m.
(Source, DAFC)

Market

On the European market, fresh legs and other types of cuts are sold at increasing prices. There is a stable export situation on the British bacon market. As regards markets outside of Europe, exports remain unchanged as well. The Russian market remains closed for all exports of pig meat from the EU. Exports to China and Japan remain unchanged.

Danish Slaughterhouses - payments week commencing 17 March 2014
SlaughterhouseDanish CrownTican
Slaughter pigs (70.0 – 86.9 kg)
Difference to last week
€1.359/kg
+0.027
€1.359/kg
+0.027
Sows (Above 129.9 kg)
Difference to last week
€0.973/kg
+0.040
€0.973/kg
+0.040
Boars (Above 109.9 kg)
Difference to last week
€0.849/kg
+0.040
€0.849/kg
+0.040

France

Hope in Paris

The inflatable pig named Hope is continuing its European trip and was flying above Paris last week. The 10x6 metre pink balloon is being used by CIWF to stress the difficulties experienced by the French pig meat industry to comply with animal welfare rules. All sows do not lie on straw bedding and even today about 20% of French pig farms are still not up to European standards.

Green light for Taiwan

At a time when French pig meat is banned from some countries, good news comes from Taiwan where an agreement has been confirmed for five French plants to export pig meat there from 4 March 2014, a sixth one should be approved shortly. This is the result of a successful audit organised last spring by the Taiwan authorities in France and involving close collaboration between FranceAgriMer and SNIV-SNCP.

Market data for week 11

Pigs: The base price of 56 TMP fell 1 cent on Monday in Plérin due to a lack of sufficient bids to cover all the present needs and encouraged by increases in Northern Europe during the weekend before. Although still cautious in their purchases, slaughterhouses need to run their lines, however, the low supply is confirmed (less than 9000 pigs were presented in the first session), driving prices upwards.

Piglets: Nothing moved in France earlier this week. The low supply continues to support prices. Demand is regular. Between volumes measured and marked rises in prices for fattening pigs, indices FNP-FNCBV firmed last week, climbing 1 cent for 25kg and 12 cents for 8kg.

Cuts: The meat market shows no great change. In exports, operators are looking for solutions to overcome the lack of supply from Russia. They could be helped by a global market showing signs of firmness, although the third week of the month is never really conducive to household purchases. Pricewise, despite a persistent imbalance in carcases, slaughter cutting has attempted to redouble efforts to revise prices upwards to overtake the best recent prices for fattening pigs.

Pork prices RUNGIS week commencing 17 March 2014

Cut namePrice range (Euro/Kg)
Back fat, rind-on 0.50
Trimmings 1.30
Leg 2.68
Loin including chump 2.98
Loin excluding chump 2.50
Belly extra without trimmings 2.70

Germany

Pressure after price increase

Lower supplies of slaughter pigs and improved demand from abattoirs resulted in a 13 c/kg increase in the recommended price last Friday. This was the largest increase recorded since January 2011 and significantly higher than most market participants expected. While the increase was mostly uncommented by the operators, some resistance to the higher price became evident as the week progressed. Most slaughter facilities reduced slaughter. In addition, one major operator announced a price of €1.55/kg from Wednesday onwards, 5c less than the recommended price. However, the supply of slaughter pigs is still relatively low and pigs can be placed mostly without problems.
(Source, own)

Tönnies new priorities

The German pork leader (28% share of the German pork market) is investing in new freezing facilities in Weissenfels with a capacity of 400 tonnes per day. It is also investing in by-products processing for the pharmaceutical and feed industries. In common with other major European pork processors, the concern also intends to develop its sales in North America. In 2013, Tönnies slaughtered 16.4 m. pigs (+300,000).
(Source, Boerderij Vandaag)

Another Vion abattoir to close

The Lingen abattoir which lost its major retail customer last year with kill down to 12,000 per week and losses of €1m will close. The plant also failed to secure enough pigs from nearby Holland and could not gain enough export orders to replace the lost business. Vion retains its Emstek plant in Lower Saxony.
(Source, Vion)

Pork Prices Hamburg Market Week commencing 17 March 2014
Cut namePrice range (€ / kg)
Round cut leg 2.20/2.35
Leg (boneless, rindless max fat level 3mm) 3.00/3.25
Boneless Shoulder 2.35/2.50
Picnic Shoulder 1.90/2.10
Collar 2.75/2.90
Belly (bone in, ex-breast) 1.95/2.25
Sheet Boned Belly (rindless) 1.90/2.25
Jowl 1.00/1.15
Half Pig Carcasses U class 1.98/2.08

Belgium

Bilateral talks with Rosselkhoznadzor

Belgium alongside other Member States has entered bilateral talks with Moscow regarding resumption of pork exports following the ASF ban. “Dankvert said Russia was ready to resume imports of Belgium pig meat as soon as a new certification mechanism is agreed with Brussels”. More pressure on the European Commission...
(Source, Agra Europe, our comment)

New salmonella norms

Due to the continuing high incidence of salmonella in Belgian pigs, new norms for abattoirs control will be implemented from 1 June.
(Source, Boerderij Vandaag)

Netherlands

Dutch exporters eyeing New Zealand market

With the New Zealand market now open to EU pork, the country is an attractive target for Dutch pork exporters. With only 46% self-sufficiency, New Zealand production is not very competitive with very low slaughter weights and high welfare standards.
(Source, Boerderij Vandaag)

German finishers prefer Danish to Dutch weaners

Dutch producers must improve the quality of their weaners. In particular, Danish weaners are generally five weeks old (28-32kg) against four for Dutch weaners (< 28kg). Hardiness and lack of ear damage are other factors quoted by analysts.
(Source, Boerderij Vandaag)

Spain

Dankvert meets Tejerina in Madrid

On 14 March, Sergey Dankvert, the Head of Rosselkhoznadzor, met Isabel Garcia Tejerina, Secretary General of the Ministry of Agriculture and Food of Spain and Paola Testori Coggi, Director General for Health and Consumers. In the course of the meeting, the participants discussed the possibility of resumption of pork exports to the Customs Union. Mr. Dankvert said that the only way to solve the conflict and to make the future export of pork possible from other EU countries than Poland and Lithuania is to conduct negotiation between the European Commission and the Commission of the Eurasian Union.
(Source, piginfo.ru)

Resti Sánchez’s closure

The Iberian pork meat processor Resti Sánchez from Extremadura has closed operations after several years of heavy losses.
(Source: Alimarket)

Carlos Serrano, the new President of Anice

The businessman Carlos Serrano has taken over as President of the National Association of Meat Industries of Spain (ANICE), at the General Meeting that was held in Madrid’s ANICE Headquarters. ANICE represents about 800 companies.
(Source: Alimarket)

Pork prices Barcelona Market Week commencing 17 March 2014
Cut namePrice range (€ / kg)
Gerona Loin Chops 2.38/2.41
Loin Eye Muscle 3.08/3.11
Spare Ribs 2.78/2.81
Fillets 5.33/5.36
Round Cut Legs 2.78/2.81
Cooked Ham 2.51/2.54
Rindless Picnic Shoulder 1.61/1.64
Belly 2.10/2.13
Smoked Belly with Spare Rib Section Cut off 2.53/2.56
Shoulder chap or Head Jowls 1.07/1.10
Back Fat, Rindless 0.53/0.56

USA

US pork trade in turmoil

With the fear of falling supplies due to the epidemic of PEDv, pork prices have reached a record with carcases cut out value at 130.4 c/lb (£1.74 kg) and bellies at 178 c/lb (£2.38/kg).

PEDv is becoming a serious issue with abattoirs

US abattoirs have resorted to slaughter four days a week as the shortage of pigs is getting acute. Tar Heel, the giant Smithfield Foods abattoir, stopped slaughtering pigs on 14 March.
(Source, own)

Canada

Lots of interest from European exporters

The Danes were, until recently, about the only exporter of European pork to Canada. The Russian ban and the PEDv crisis are fast changing the pork trade. Canadian traders report a lot of interest from German, Dutch, Italian and Spanish pork producers.
(Source, own)

Group housing for sows?

Due to pressure from North American buyers, the Canadian pork sector is now considering a move away from stalls and tethers.
(Source, Boerderij Vandaag)

Brazil

Better prospects for pig producers

After two tough years, production is expected to rebound to 3.65m tonnes (+3%) due to lower feed prices. Exports are expected to rise by 15%. A rebound of export to Russia is expected as well as higher sales to Eastern Europe (Ukraine, Belarus) and South East Asia (Singapore, Thailand, Philippines).
(Source, Agra Europe)

Dearer soya

The drought in Brazil, particularly in the key state of Mato Grosso will affect the soya harvest. The USDA predicts a world price hike of 24%.
(Source, Boerderij Vandaag)

Russia

Moscow pork market 12 March 2014

Half carcases £2.22/kg, boneless legs £3.38/kg.
(Source, MeatInfo.ru)

Ukraine

ASF eliminated?

The State Veterinary Service of Ukraine managed to eliminate the ASF in Luhanska oblast of Ukraine. For reference, four cases of the disease were registered in the beginning of 2014 in this oblast. The quarantine is now lifted in three out of four affected regions of the oblast. However, the Veterinary Service in Luhanska oblast, insists that it is still necessary to cull all wild boars in the hunting areas of the oblast.
(Source, Pigua.info)

Increase of pig population

According to the information provided by the State Statistic Service of Ukraine, as of 1 March, the population of pigs in Ukraine was 7,907,600 (+3.2% on 2013).
(Source, http://www.ukrstat.gov.ua)

Tariff-free quotas for pork

The EU has freed imports of most agricultural products, raw and processed, from the Ukraine under autonomous trade preference. Pork is an exception and Ukrainian exports will benefit from duty-free Tariff Rate Quota (TQR).
(Source, EU)

China

More investment

On 17 March, Chongqing Qijin Food Co. Ltd. signed a contract with Nanchuan government of Chongqing to invest over Y250m (£25m) to a production base for an annual slaughter of 200,000 heads.
(Source, BOAC)

Hungarian pork

Six Hungarian pork plants were given the green light for direct exports to mainland China.
(Source, Hungarian Ministry of Agriculture)

Wan Long Industrialist of the Year

The architect of the Smithfield takeover, Wan Long, was named by China Weekly News Industry Man of the Year, saying he had had more impact on China in 2013 than any other business man or entrepreneur. Mr Long and Shanghui have a line of credit of £800m from the Bank of China for further acquisitions.
(Source, Asian Pork)

Chinese wholesale prices week commencing 17 March 2014

 Price (RMB/Kg)£/KgChange on week
Pig Carcases 18.16 1.76 0.22%
Source: BOACL
Prices collected from wholesale markets in 36 medium and large Chinese cities

Vietnam

Vissan buys pig units

The pork processing leader has bought two farms with 3,600 sows to develop its production base. As seen in bulletins passim, the firm aims to develop its own production to 30% of its output.
(Source, Asian Pork)

Thailand

Production down

PRRS, PED and poor weather conditions caused Thai pork production to contract by 30% in January. As a consequence, prices climbed to £2.38-2.48/kg.
(Source, Asian Pork)

CPF opposes pork import

Charoen Pokphand Foods (CPF), the Thai and Asian pork leader, urged the government to ban imports from the USA as it could damage Thai production. The use of ractopamine, banned in Thailand, is a good enough reason, Mr Narong, CPF Senior Vice President says.
(Source, Asian Pork)

Betagro genomic push

The second largest pork producer and processor in Thailand has teamed up with the Khon Kaen University and the Nat. Science & Technology Dev. Agency to implement genomic selection in its breeding programme. An example of Betagro development is the Be 91 line “proved to offer high resistance to stress, rich red meat, high-quality piglets for fattening, excellent heritability and exceptional tolerance to Thailand’s tropical conditions… the breed yields more kilos of marbled red meat with fine streaks of fat and is best for the food service industry in Thailand including upscale restaurants, general food shops and airline catering companies”.
(Source, Asian Pork)

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