January 31, 2013

Russia's January live pigs, pork prices down

Russia's prices of live pigs and pork have reached the lowest level ever in January 2013.

For several months now production in the Russian pig industry has become cheaper and since September last year, prices of domestic production of live pigs decreased 27% while for pork half carcasses - it decreased 23%. Also the growth of prices for feed for this period was more than 30%, according to Sergey Chernyshev, from the analytical agency IMIT.

As a result over the last year in Russia, there has been a marked reduction in the gap between the prices of domestic products and foreign pork production. On average during 2012 the price for pork has decreased by 20%, while in other major producing countries, it has risen by more than 10%. Thus, at the end of 2012 for the first time, in China pork became more expensive than in Russia.

By the end of January, according to IMIT, the cost of pork half carcasses in Russia reached RUB114.0 (US$3.7) per kilogramme, while in Russia it was only RUB107 (US$3.6) per kilogramme.

"One of the main reasons for the decline in prices of pork in the country is a significant increase in the supply of pork imports. Over the last four months of 2012, imports of chilled and frozen pork to Russia increased 28% compared to the same period of 2011. Since mid-November 2012 the import pressures on domestic prices increased with the weakening of the dollar exchange rate against the ruble," said Chernyshov.