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AHDB Pork Weekly Export Bulletin


31 May 2016

AHDB Pork Weekly Export Bulletin - 31 May 2016AHDB Pork Weekly Export Bulletin - 31 May 2016


British Pig Executive Weekly Export Bulletin

Pork was the food & drink category with the highest export growth in March from the EU. Pork exports rose from €318m in March 2015 to €422m, a rise of 32.5%.

USDA and Rabobank concur that world production will fall by 0.9% in 2016, led by smaller Chinese output. World pork trade will grow by 7.9% this year, with high demand from China, Mexico and South Korea.
The European Commission was a bit more optimistic prior to the meeting between Commissioner Andriukaitis and the Russian farming minister on Sunday 22 May, in the margins of the OIE general meeting in Paris. This was the first official high level meeting between both sides since the crisis began. The European Commission had also received a letter from the Russian veterinary services (Rosselkhoznadzor) for an invitation for “technical discussions”. However, the short meeting achieved nothing, with the European Commission still refusing the principle of bilateral negotiations.

The issue of pork fat stocks due to the Russian ban, is still acute in Europe. There has been a sharp rise in exports to China, which have increased nearly eight fold in Q1 to 15,000 tonnes and have also risen to The Philippines. Overall, EU raw fat exports have risen from 37,800 tonnes in Q1 2015 to 51,500 tonnes. However, they are still far below the level of 2014 when 87,300 tonnes were exported in the first quarter, including 62,100 tonnes to Russia. The value of the fat has also fallen from €960 per tonne to €600 per tonne.

Germany

Tegut’s new branded pork
The German retailer will work more closely with local farmers from Röhn and Vogelsberg regions for its new Landprimus programme, with pigs slaughtered in Fulda. The feed will be GMO-free and the pigs raised with very low antibiotic usage to organic level. (Source, LZ, various)

Markets
After a mainly balanced market last week, the market currently has regional differences. Demand is mostly high but available pig numbers range from a normal amount to barely sufficient in some regions. This is especially true following several slaughter facilities increasing their activity in the current week. Additional impulses are expected from the meat market and increasing sales are expected for the forthcoming week. Even though the current overall demand for slaughter pigs and pork cuts is not as high as a few weeks ago, the sales are reported as good while the available numbers are comparably low. Therefore, the recommended price was increased to €1.48 per kg. (Source, AMI)

Spain

Major fire
A fire has destroyed the Embutidos Rodriguez pork processing plant in Soto de la Vega (Castilla y León) which employs 400 people. Previously, a fire gutted the major Campofrio plant in Burgos in November 2014. (Source, ABC)

France

Charcuterie sector weakens
Last year, retail charcuterie sales eased marginally with volumes falling by 0.6% with the value easing by 0.3%. There are several reasons that help to explain this situation: the general decrease in meat consumption, the increase of negative reports in the media, the impact the producers’ crisis has on the image of the industry and the CIRC report explaining the link between the intake of charcuterie products and some cancers. Cooked ham, the heavy weight of the category lost €10 million in 2015. Charcuterie manufacturers such as Fleury-Michon and Herta are launching new products to attract shoppers. However, in terms of innovation, the competition comes from poultry-based products which are the preferred options for a “healthy diet” and also from the halal segment which represents the strongest growth in terms of added value, with sales increasing by 10.5%.

Country of origin
An experimental trail on country of origin labelling suggested by France for a period until 31 December 2018 for milk and meat used in processed products, is subject to a positive response being received from the Commission, expected in mid-June. The proposal is warmly welcomed by French cooperatives such as Cooperl (and their processing branch Brocéliande acquired in 2009). The mention of origin for dry ham is a strong selling point; sales were up 3% in volume with origin declared and down 6.9% without. However, other processors fear an increase in prices as France is not self-sufficient for legs. Today, 60% of charcuterie products mention the origin of the meat, which represents 75% of total volumes.

Markets
Pork: The disruption due to the Pentecost bank holiday was partially compensated for by very strong activity by slaughter facilities. The French market began the week close to the balance with the 56 TMP base price reported as virtually stable with a small €c0.1 increase.
Piglets: The situation on the French market is not very good. Buyers have been very prudent on the face of stable supplies. Last week, the FNP-Coop de France prices increased by €c2 for 25kg weaners and by €c48 for 8kg piglets.
Cuts: China continues to break records with high purchases of European pork meat. According to Brussels, in the first quarter, The Asian giant imported 388,782 tonnes, up 77% compared with the same period last year. EU exports to Japan increased 21%, were 28% higher to Hong-Kong and up 35% to the Philippines. There were countries where shipments decreased, South Korea easing by 34% and exports to Taïwan fell by 11%.

Switzerland

More smuggling
Swiss customs officers have uncovered a cavern of Ali-Baba smuggled food and drink in a double garage in the Vaud canton. This included 2,800kg of Portuguese ham, 1,400 litres of wine, 520 litres of spirit, cheese and olive oil. Smuggling is currently exploding in Switzerland due to the high local prices. (Source, Le Matin)

Denmark

Markets
On the European market fresh hams traded to similar prices on the week. For collars and loins, prices eased in the line with the poor prevailing weather, while other cuts traded at stable price levels. Sales to China and Japan remained good, while activity to other third-country markets was reported as calm. (Source, lf.dk)

Hungary

Pork promotion programme and positive consumption prospects
The KMS programme (Kiváló Min?ség? Sertéshús) is developing, with a new Internet site www.finomsertes.hu providing information and recipes. Previoulsy, Hungarian pork consumption has fallen from 37.6kg per capita in 1991 to 24.9kg in 2014. However, a reversal is on its way, largely aided by the reduction of VAT on pork from 27 to 5%. As a consequence, the Spar pork processing plant in Bicske will benefit from a £4m investment as the retailer is positive regarding prospects. The whole pork sector remains very fragile and suffers from underinvestment. (Sources, KMS, European Supermarket, own)

Russia

ASF registered in Briansk oblast
Results of laboratory analysis on samples taken from the corpse of a pig that died in Briansk oblast, showed that the death was caused by the ASF virus. Currently, measures are being taken to prevent any further spread of the disease. (Source, meatinfo.ru)

Ukraine

Wholesale pork prices update
Wholesale pork prices in Ukraine continued to decrease. As of last Friday, the wholesale price for pork in liveweight was UAH27-28 per kg (US$1.07-1.11 per kg) in the central and eastern regions. In western regions the price was UAH26-28 per kg (US$1.03-1.11 per kg). Most of the sellers are rather pessimistic and report that sales during May will be 20% to 40% less than in April. (Source, pigua.info)

Another ASF outbreak
After six pigs died in the Khmelnytskyi oblast and analysis proved the cause of death was the ASF, the rest of the pigs in the village were destroyed to prevent any further spread of the disease. Two cases were also registered in Sumy oblast, where three pigs died. Measures were also taken to prevent further spread of the disease. (Source, gazeta.ua pigua.info)

Crimea

Emergency mode introduced due to the ASF cancelled
On 18 May, local administrators cancelled the emergency measures that were introduced due to an outbreak of ASF in the region. While the emergency measures were in place, 9,000 pigs were confiscated and slaughtered. The affected farmers received compensation totalling RUB77m. (Source, meatinfo.ru)

USA

Production will edge up in 2017
Expanded farrowings and continued strong increases in litter rates are expected to drive USA pork production in 2017 to 11,700,000 tonnes, a 2.6% increase over production this year. Prices are expected to remain stable. (Source, various)

“Power of Meat” consumer survey
This important study shows that 58% want the presence of GMO declared on products, 68% want traceability, 68% want to know if the animal has been administered antibiotics and 70% hormones. US food buyers say: “As a shopper, I have the right to know how you’re producing it, where the animal was raised, what it was fed”. These numbers confirm the wide gap between the current food situation in the USA and the wishes of consumers. This situation lends itself to the growth of ‘alternative’ meats segments, such as antibiotics/hormones/GMO-free (free of substances I wish to avoid and good for my health), high animal welfare, grass-fed and organic meat. The numbers speak for themselves. In 2013, 20% of respondents wanted to eat more “natural/organic” meat and 10% wanted to reduce their consumption of the said meats. In 2016, 28% of them now want to increase and only 6% want to reduce. (Source, MeatingPlace)

South Africa

Customs issues
Clearing issues are continuing in Durban, with delays in clearing frozen containers. (Source, AMIE)

China

Pork destocking
In an effort to help alleviate the shortage of pork in China and the subsequent high prices, the country’s Ministry of Commerce (MOC) has now released 150,000 tonnes of frozen pork from its state reserves in 12 regions of the country including Beijing, Zhejiang and Shaaxni since December 2015. The MOC intends to continue to make more frozen pork available, as it intends to release an additional 3,050 tonnes of pork between early May and 4 July. That includes 50 tonnes of pork that will be sold on a daily basis to 121 supermarkets in the country. These volumes are relatively small with regards to the size of the Chinese market and will not dent the continued strength of pork prices. (Souce, CNAgri, our comment)

Japan

Chilean promotion
ChilePork held a seminar on the international meat trends in Tokyo. The event hosted by Juan Miguel Ovalle, the President of ChilePork, was supported by GlobalAgriTrends. A golf tournament completed the programme. (Source, Eurocarne on line)

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