BPEX Export Bulletin - October 2011: Week 41

by 5m Editor
19 October 2011, at 12:00am

The British Pig Executive's (BPEX) Export Bulletin for the second week of October 2011 reports pig industry trends from around the world.

About 250 people attended the 22nd English Meat Dinner during Anuga in Cologne which celebrated Red Tractor produce and was addressed by Minister, Jim Paice. The show itself will be remembered as the largest and best attended ever. Judging from the buzz this week, the international pork trade is in rude health.

A EU scheme provides subsidies for the exchange of young managers between European countries. This may appeal to exporters keen to learn from local importers. For more information, click here.

See below some notes regarding the recent World Pork Congress that took place in Bonn just before the Anuga fair.



There is a good balance between supply and demand on the European markets. Fresh legs are sold at slightly increasing prices. Other cuts are sold at a mainly unchanged price level. For the British bacon market the demand remains fine and the trade is steady. With respect to countries outside the EU exports are still fine to China with very attractive prices. Exports to other countries remain stable.
(Sources, Danish Crown, Tican, Danish Agriculture and Food Council)

Boar taint solution?

Scientists of Aarhus University have found out that the feeding of chicory for a period of 14 days shortly before the end of the fattening period supports the production of those liver enzymes responsible for the degradation of taint causing substances skatole and androsterone. However, it was not yet revealed which substances contained in chicory cause this effect. Due to the cost of using chicory in feed, scientists are now aiming to identify the specific active agent in order to extract it from cheaper plants or to produce it synthetically.
(Source, ISN)

Danish Crown has fewer slaughterings and dismisses employees

At present, Danish Crown slaughters 10,000 fewer pigs weekly than in spring this year. It corresponds to about three per cent of Danish Crown’s former weekly slaughterings and thus the slaughterings have dropped to approximately 300,000 pigs weekly. Danish Crown reacted promptly to the decline and made 500 employees redundant. The decrease in the number of slaughtered pigs occurs after a longer period during which Danish Crown received more pigs at the slaughterhouse and exports of slaughter pigs to Germany dropped strongly. A statement based on information from the Danish Agriculture & Food Council shows that whereas Tican and Danish Crown slaughtered 12.8 million pigs during the first eight months of 2010, slaughter numbers totalled 13.7 million during the same period this year.
(Sources, Ritzau, Landbrugsavisen)

Danish Crown continues streamlining

A tough cutting plan including closure of Danish plants, lay-offs in Denmark and abroad and the employment of more, lower-paid employees has been successful. After several years when Danish Crown has been paying its suppliers significantly less per kilo of pig meat, now during the past year it paid 1.6 Eurocents more per kg pig meat than the German slaughterhouses. Six years ago, Danish Crown had 15,000 employees in Denmark. Today, the figure has fallen to 9,000. During the same period, employment in the foreign Danish Crown companies has increased from 10,000 to 15,000. Meanwhile, the efficiency and savings plan ‘DC Future’ reduced its annual costs by nearly €175 million. However, Danish Crown has not yet reached its goal because the competitors are moving rapidly too. So it continues automating and streamlining. "The high Danish wages are still a considerable challenge to our competitiveness. For identical jobs the wage index is 100 at the Danish factories, 44 at the German plants and 28 at the Polish plants," said Karl Christian Moller, chief analyst of Danish Crown.
(Source, JyllandsPosten)

Too much corn in feed makes fat soft

The back fat of Danish pigs and the fat from legs and front is sold at high prices due to the high quality. Lisbeth Jørgensen, project manager of Danish Agriculture & Food Council, just researched how corn in the feed blend will affect the fat. Her conclusion is that a high content of corn in slaughter pig feed affects the fat, which will become softer. Vegetable oils and rapeseed have shown to affect the hardness of the fat too. Accordingly, the recommendation is not to exceed 40 per cent corn in feed. Fat is often used in smoked and dried productions, and should the hardness of the fat fall, it may become difficult to sell at today’s high prices. Should the fat become too soft, the melting point will change and it will have an impact on the end product, which will decrease in quality. Should the quality fail, it may lead to a 50 per cent decrease of the price of fat, according to Jens Rahbek, export manager of Danish Crown.
(Source, Landbrugsavisen)

Danish Supreme Court overrules food safety

The Supreme Court decided that the Danish Crown subsidiary Plumrose US must pay approximately €7 million because the company in agreement with the local food authorities decided to withdraw a batch of food products that had been contaminated with machine oil in a meat grinder. The Supreme Court acknowledges in its judgment that the food products were contaminated with machine oil. However, the court finds that there was no need to withdrawing the products. All Danish Crown companies are insured against such incidents in order to at any time secure food safety first. The insurance company and thus the Supreme Court as well do not find that the food products should have been withdrawn, said CFO of Danish Crown, Preben Sunke. The judgment says, among other things, that an adult would need to consume approximately one kilo of the oil contaminated meat before it would be harmful. Danish Crown operates according to a precautionary principle and will not take any chances with food safety or consumer safety. However, the company must conclude that the court does not agree with this view, says Preben Sunke. The bill in Plumrose US means that the financial result of the entire group is negatively affected with approximately €4 million after taxes.
(Source, Danish Crown, Landbrugsavisen)

Danish slaughterhouses - payments week commencing 10 October 2011
Slaughterhouse Danish Crown Tican
Slaughter pigs (70.0-86.9kg)
Difference to last week
Euro 1.374
Euro 1.347
Sows (above 129.9kg)
Difference to last week
Euro 0,973
Euro 0,973
Boars (above 109.9kg)
Difference to last week
Euro 0.840
Euro 0.840


Deferred delivery

MPB (Marché du Porc Breton) is the only source of official prices for live pigs in France. Established in 1972, MPB is a simple spot sale mechanism which involves 13 groups of producers and 12 processors and one livestock trader who, altogether, trade 68,000 pigs per week. MPB recently tested a new marketing mechanism with one group of producers (Syproporcs) and Kerméné (Leclerc integrated pig abattoir and pig meat processor). This new system operates as follows: producers give a target price to MPB for a delivery to be completed between four and 18 weeks after the date of the proposed price. Then MPB gathers a list of sales proposals with differed delivery without the price and until the producer does not get the targeted price, he can refuse the sale and re-submit his batch, week after week, until he reaches the delivery date. This system guarantees a selling price avoiding a sudden drop of the market. For the buyer, it secures the supply in volume and price. So far, processors are a bit reticent and only Kermené has shown interest to secure short-term requirements but as soon as one or two other operators decide to use the mechanism, the others should follow as they would fear not getting necessary volumes. As 70 per cent of the price of a pig is feed, this system would also benefit to producers who already buy feed in the same way.


According to the Institut du Porc, the price ‘Ifip’ for animal feed lost €4 between August and September, to settle down to €253 per ton. This price is still higher by 23.4 per cent than the one in autumn 2010. For Ifip, this price will not decline due to the tensions envisaged in cereal markets. In this context, breeders do not expect to slow down their production costs and they still hope to raise their sale prices. This objective is not impossible especially if our exports remained good.


Following the FNICGV, between August and September, the prices recovered on the MIN of Rungis for the majority of cuts, except for ham. In September, prices were higher from 2.4 per cent to 7.4 per cent than in September last year. The most significant is for back fat: +94 per cent or +33 Eurocents. This valuable recovery is in parallel with the sensitive increase of the basic price 56 TMP (8 per cent) as of the national quotation of pigs E (+4.3 per cent).

Pork prices Rungis, week commencing 10 October 2011
Cut name Price range (Euro/kg)
Back fat, rind-on 0.75
Trimmings 1.38
Leg 2.09
Loin including chump 2.72
Loin excluding chump 2.63
Belly extra without trimmings 2.22



Despite the autumn school holidays, large quantities of half pig carcasses were ordered on the Hamburg market. Prices for cuts mostly remain unchanged although sales of chops and loins are rather sluggish. Hams and fillets are sold without problems and there is fine demand for shoulders, bellies and fat products.
(Source, AMI)

The big ones

According to the afz ‘Top 150’ ranking, the German meat industry was back on growth track in 2010. The majority of abattoirs and deboning enterprises reported increased revenues. At the top of the list is again Tönnies, with a sales volume of €4.3 billion, followed by Vion Food Germany (Düsseldorf) with €3.7 billion. Third comes the PHW group with a revenue of €2. 1 billion, Westfleisch ranks fourth having achieved a revenue of €1.93 billion. For the first time, a meat processor is included in the list: Hersito AG takes fifth place in the top 150 ranking. In terms of slaughter numbers, Tönnies, Vion and D+S (taken over by Danish Crown) together slaughtered about three million pigs more than last year.
(Source, afz)

Dutch expansion

Dutch retailer, Ahold, is continuing on its aggressive expansion course. For 2012, Ahold has announced its target to enter the German market with the convenience format, ‘AH to go’, to expand on the Belgian market and to take over some competitors. The first Ahold shop in Germany is planned to open its doors in the second half of next year.
(Source, afz)

Pork prices, Hamburg, market week commencing 10 October 2011
Cut Name Price range (€/kg)
Round cut leg 2.15/2.35
Leg (boneless, rindless max fat level 3mm) 2.90/3.10
Boneless Shoulder 2.45/2.60
Picnic Shoulder 1.98/2.20
Collar 2.25/2.40
Belly (bone in, ex-breast) 2.30/2.50
Sheet Boned Belly (rindless) 2.20/2.40
Jowl 1.40/1.50
Half Pig Carcasses U class. 1.95/2.05


New retail concept

VWU/Uw slager has launched a new franchise butchery concept called 'Meat & Meals' with a focus on prepared meats. Two stores have just opened and 10 more are planned.
(Source, VWU)


Belgium declared free of Aujeszky’s disease

The European Commission has officially stated that Belgium is now free of Aujeszky’s disease. Exports to Germany will become easier. The price for piglets is expected to drop by approximately €5 per piglet.
(Source, Various)

Statement rebuked

Two weeks ago, a minority farmers’ union declared that Belgium should/would cut 10 per cent of its production in response to cost pressure. This was widely reported in the media. We did not report this and were vindicated by the Belgian views that such announcement had more to do with a PR coup than reality.


Continuous lack of animal welfare

The EU Commission has urged Spain to comply with the EU regulations on animal welfare in the process of slaughtering animals. On several occasions, the EU Commission still found breaches of the animal welfare regulations in connection with slaughtering. According to the Commission, Spanish slaughterhouses do not observe the regulations on fixing and stunning the animals in the slaughtering process. The Commission gave Spain two months to comply with the requirements, otherwise the Commission will take Spain to the ECJ.
(Source, Markedsnyt for Svinekoed)

Pork prices in Barcelona market, week commencing 5 September 2011
Cut Name Price range (€/kg)
Carcasses (secondary grade) --/--
Gerona Loin Chops 2,36/2,39
Loin Eye Muscle 3,41/3,44
Spare Ribs 2,71/2,74
Fillets 5,83/5,86
Round Cut Legs 2,40/2,43
Cooked Ham 2,02/2,05
Rindless Picnic Shoulder 1,60/1,63
Belly 1,88/1,91
Smoked Belly with Spare Rib Section Cut off 2,31/2,34
Shoulder chap or Head Jowls 1,23/1,26
Back Fat, rindless 1,18/1,21


Sergey Dankvert dismissive

Russia is willing to control the African Swine Fever outbreak, according to Sergey Dankvert ,the Russian Chief Veterinary Officer, speaking at the World Pork Congress. However, the authorities seems loathe to curb backyard pig farming in Southern Russia, where many units have no biosecurity, illegal animal movements are still rife and Georgia remains a reservoir for future outbreaks. Some 21,000 pigs were recently culled in a single farm as there was no biosecurity measure to protect it. Obviously, the cost was borne by the Government.

The custom union

The EU model was used for the administration of the custom union between Russia, Belarus and Kazakhstan that came into force on 1 July. Existing certificated will be retained until 2013. The EU counts 4,577 listed food suppliers to Russia and the Union, or half the total of listed suppliers allowed to ship food. Despite the high profile recent delisting of German plants, Russia remains very positive towards German pork.

Development potential

Even not including projects likely to be cancelled, the Russian industry indicates that some 700,000 tonnes of additional pork may be produced in five years time.

High domestic prices

In August, the number of pigs in all kinds of pig farms in the Russian Federation totalled 18.8 million (0.2 per cent more than in August 2010). Wholesale prices for domestic half pig carcasses of the first category was US$4.43, which is 11 per cent more than last year. The wholesale price for domestic half pig carcasses of the second category of domestic origin was US$4.05, eight per cent higher than last year.

Rosselkhoznadzor to ban import of Brazilian pork to Russia

Rosselkhoznadzor may ban import of Brazilian pork produced from pigs bred with the use of special medical feed additive Raktopamin (ractopamine), which is used to increase the weight of the animals. A group of Russian veterinary experts will travel to Brazil to inspect the systems of control over animal products produced for export. The experts will also study the use of medical additives that boost the growth of animals and the use of antibiotics. As reported previously, Rosselkhoznadzor has currently restricted supplies of pork from many Brazilian enterprises because they are still failing to meet Russian veterinary requirements. According to Rosselkhoznadzor experts, the consumption of meat produced with the use of Raktopamin is dangerous to human health.

More pigs

As of 1 October 2011, the total number of pigs in all kinds of pig farms and households was 8,134,500 animals, 3,540,900 of them bred on pig farms and 4,593,600 in households. During September, 30,600 tons of pigs in live weight were slaughtered (9.7 per cent more compared with September 2010).

Another outbreak of ASF in Kuban Region

According to information provided by Rosselkhoznadzor, in Pavlovskiy Region in Krasnodarskiy Kray pigs are being slaughtered due to a outbreak of African Swine Fever. As of 10 October, 593 pigs have been slaughtered in the region to stop the spread of the disease.



FAO vets will allow the trade of segregated production chain in case of an outbreak of disease. The UK poultry sector now functions according to this principle. A new Chilean pork development by Super Pollo in the Northern desert is fully compartmentalised with its own feed mill, production units, abattoir and even port for the shipment of frozen pork is the first such project to emerge.


Poultry giant wants pigs

Brazilian poultry giant, Brasil Food (BRF), with revenue of about €10 billion, has declared its interest in parts of the Brazilian pig division of French poultry producer, Doux.
(Source, fleischwirtschaft)



Quebec producers report a familiar story: lack of profitability, indebtedness and falling production.

Viet Nam


The FAO at the World Pork Congress voiced serious concerns regarding water pollution in parts of the country due to the high concentration of pigs.


Consumption figures

Only 21.5 per cent of US pork is consumed fresh with 78.5 per cent consumed in a processed form. Consumption is fairly stable at around 12kg per person per year. Bacon is the star product and shows good growth in food service, present in half of the restaurant menus and often in bacon-cheese burgers. Ham and sausage consumption are growing too. Some 28 per cent of Americans eat 78 per cent of the pork.
(Source: US Meat Export Federation)


Pigs contribution to global warming

According to the FAO, pigs contribute 1.6 per cent of world’s global gaseous emissions of 793 million tonnes of carbon dioxide-equivalent.

Rabobank and GIRA views

According to their experts, prospects for world pig production are rosy although slower production growth is forecast. High imports from South Korea following the FMD epidemic is driving forward the world pork trade. Analysts at GIRA are similarly upbeat with growth of the world pork trade.

October 2011