SPAIN - The offer of pork is lower than the demand. European Animal Welfare regulations that have been implemented and high grain price has decreased the offer of pork, writes Javier Santamartina, Spain, Italy & Portugal Genesus Representative..
This situation will continue for the meantime, causing the price for the early part of the year to be favorable for the producer at 1,377€/kg (81.04¢/lb. USD) today. We can compare the price per country for the first 10 weeks in 2013 in 2012.
|Price first 10 weeks of 2013||Price first 10 weeks of 2012|
|Spain||1,33 €/kg (78.30¢/lb. USD)||1,18 €/kg (69.49¢/lb. USD)|
|Germany||1,30 €/kg (76.54¢/lb. USD)||1,22 €/kg (71.84¢/lb. USD)|
|Holland||1,36 €/kg (80.09¢/lb. USD)||1,21 €/Kg (71.27¢/lb. USD)|
|France||1,25 €/kg (73.61¢/lb. USD)||1,22 €/kg (71.84¢/lb. USD)|
The main reason for this price is that there is not enough pork in stock versus the huge demand in the market place, other reasons may be:
- EU pork consumption is low like in the past, however, the situation in France is a little bit different, French pork is for the internal market and their price is lower than that of exporter countries, like Spain, Germany, Netherlands or Denmark.
- Price for internal consumption is controlled by distributors and if they don’t increase the price, this means that price increases go directly to the losses of the pork processors. In the long term this is a threat because this loss will cause many to go out of business.
- Exports and international pricing remains static.
- Russia and China have put partial limits on imports from Germany. From Spain the exports to Russia and other countries are acceptable but Spain does not have large stocks to export.
- The global exporters like EU, USA, Brazil and Canada are at the same level but Brazil fills the gap when the EU can’t supply.
- Slaughterhouse continues to maintain the kill rate to keep costs controlled, and excesses of pork not exported but go to the frozen or internal market.
- For non-export countries like France price is lower than that in exporter countries but the trend is to increase by a small national pig offer.
In summary there is not too much in the way of an offering of pigs. Weights are lower the last five years and it is difficult to commercialize pork with good margins. There are not big stocks and the prospectus is good, especially if there is a decrease in the cost of production.
|Genesus Global Market Report|
Prices for the week of March 4, 2013
(Liveweight a lb)
|USA (Iowa-Minnesota)||74.87 USD/lb carcass||55.40¢|
|Canada (Ontario)||1.45 CAD/kg carcass||51.25¢|
|Mexico (DF)||18.60 MXN/kg liveweight||67.97¢|
|Brazil (South Region)||3.07 BRL/kg liveweight||70.97¢|
|Russia||72 RUB/kg liveweight||$1.06|
|China||13.37 RMB/kg liveweight||97.55¢|
|Spain||1.377 EUR/kg liveweight||81.04¢|
|Vietnam||38,500 VND/kg liveweight||83.78¢|
|South Korea||2,792 KRW/kg liveweight||$1.15|
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