September 18, 2012
BPEX Export Bulletin - September 2012 (Week 37)
This week's export news
Due soaring feed costs, Canada's second-largest pig producer, Big Sky Farms announced the company has entered receivership. Big Sky Farms produces 40% of the pork in Saskatchewan. The company has more than 42,000 sows in Saskatchewan and Manitoba, and produces more than 850,000 slaughter pigs in Canada and the United States annually. Big Sky Farms supplies Maple Leaf Foods and Olymel. Casey Smit, CEO, said the company was losing C$40 to C$50 (£25 - £32) per head.
Brazil
Mato Grosso in crisis
The State is expected to lose 40,000 sows by the end of this year as herds retract. This means a 30% reduction of local production. (Source: Brazil Meat)
Aurora expands plant
The pork processor is planning to increase the capacity of its São Gabriel do Oeste from 6,000 to 15,000 pigs per week and is investing R$ 100 m. (£31 million) to do so. (Source: Brazil Meat)
Denmark
Market
On the European market, fresh legs are sold at fairly unchanged prices. Shoulders, production meat and fresh loins are traded at an unchanged price level as well, while bellies are sold at slightly increasing prices. Exports to the British bacon market remain stable. The September contracts have been agreed at slightly higher prices than the August contracts. As to markets outside Europe, the activity to Japan, China and Russia continues to be fine. (Sources: Danish Crown, Tican, Danish Food Council).
|
Danish Slaughterhouses - payments week commencing 10 September 2012 | ||
|
Slaughterhouse |
Danish Crown |
Tican |
|
Slaughter pigs (70.0 – 86.9 kg) |
Euro 1.627 |
Euro 1.627 |
|
Difference to last week |
Unchanged |
Unchanged |
|
Sows (Above 129.9 kg) |
Euro 1.211 |
Euro 1.211 |
|
Difference to last week |
Unchanged |
Unchanged |
|
Sows (Above 129.9 kg) |
Euro 1.041 |
Euro 1.041 |
|
Difference to last week |
Unchanged |
Unchanged |
France
Tallec
Tallec is a charcuterie processor based in Brittany (Banalec, Finistère) specialising in high quality products. Although the specialty of Tallec is raw products to be served at traditional counter (85% of production) the President Michel Moreu is investing over €1 million this year in packaging equipment for fresh products. The company exports 15% of its production and a large number of Tallec pâtés and hams are consumed in UK.
Solidarity fund
On 30th August French wheat producers and corn producers suggested help for livestock producers by opening a solidarity capital with a voluntary contribution between €1.5 and €2.5 per ton of grain collected. This money could then be spent by producers to renovate their buildings, or invest in methane production or photovoltaic panels to diversify their sources of income.
Pigs
The base price became firmer on Monday in Plérin; +0,5 cent ; still supported by the weakness of the offer. This recovery tends to slow down due to the influence of stable prices in the North of Europe and to the slaughterhouses for whom the activity decreases with the end of the in-store promotions.
Piglets
The tendency is the same than last week. Prices are stable. Offers are moderate for the season while demand is low.
Cuts
According to "The National Federation of the Industry" and to the wholesale market, prices progressed between 3 and 9,2% between July and August. These increases are insufficient to maintain margins because the 56 TMP basic price, at the same time, was going up by 8,2%.
|
Pork prices Rungis - Week commencing 10 September 2012 | |
|
Cut name |
Price range (Euro/Kg) |
|
Back fat, rind-on |
0,85 |
|
Trimmings |
1,82 |
|
Leg |
2,57 |
|
Loin including chump |
3,25 |
|
Loin excluding chump |
3,18 |
|
Belly extra without trimmings |
2,75 |
Germany
Market
The price increase seems to have come to a halt on the Hamburg market. Trade is rather slow with large orders being rare at the moment as only the minimum quantities needed are ordered. There is a good balance between supply and demand however for some cuts such as loins or collars a surplus has been reported. Meat for processing, fat and bellies are well demanded. Shoulders are sold well with promotional activities supporting the trend. However, the overall situation is not satisfying as hopes for a very active atmosphere on the markets at end of the month and at the end of the holiday season have not materialised. The market for sow meat is balanced. Good demand is met by sufficient supply and products are marketed with no difficulties. Prices remain stable. (Source: AMI)
|
Pork prices Hamburg Market Week commencing 10 September 2012 | |
|
Cut name |
Price range (Euro/Kg) |
|
Round cut leg |
2,40/2,60 |
|
Leg (boneless, rindless max fat level 3mm |
3,30/3,45 |
|
Boneless Shoulder |
2,85/2,95 |
|
Picnic Shoulder |
2,30/2,50 |
|
Collar |
2,80/3,00 |
|
Belly (bone in, ex-breast) |
2,65/2,75 |
|
Sheet Boned Belly (rindless) |
2,50/2,70 |
|
Jowl |
1,65/1,80 |
|
Half Pig Carcasses U class. |
2,30/2,40 |
Greece
Income shock
The average Greek wage should fall from €25,470 in 2011 to €15-17,000 by 2013, meaning a return to 1979 incomes. In addition, the level of unemployment has now risen to 24% of the population. Still, meat consumption is one of the few sectors still holding. (Source: agronews.gr)
More preference for Greek food
A new survey by Greek universities has confirmed the growing preference for Greek goods. Some 93% of people support the buying of Greek goods and only 13% declare buying the cheapest products, irrespective of its origin. A Eurobarometer survey earlier this year showed that the Greek were now the most nationalistic in the EU regarding to the origin of food. (Source: agronews.gr)
Netherlands
Pork consumption down
In the second quarter, fresh pork consumption fell by 8% but this bad number is mitigated by a rise of mixed minced meat of 3.6%, higher sales of processed pork products and out of home consumption. (Source: PVE)
Plus goes for one-star pork
Plus supermarkets will purchase one-star Good Farming pork from Vion. The 259-strong chain is aiming to boost its environmental and animal welfare credentials. Plus normally buys its pork from Groothedde in Vassen who operate the Deerbescheming star system. (Source: Boerderij Vandaag)
Another success for open farms
Last weekend, some 38 pig farms open their doors to the public for another very successful action. The operation is backed by volunteers from the Varkens in Zicht ('Pigs in sight') organisation. (Source: Boerderij Vandaag)
Portugal
The country leads European price rise
Portuguese pork prices rose last week to €2.13/kg carcase. Demand remains strong and offer remains limited despite higher Spanish production and potential imports. (Source: Lonja de Montijo)
Russia
ASF
The spread of ASF comes with a heavy economic toll — last year, the Russian Federation lost 300,000 of the country's 19 million pigs to the virus, at an estimated cost of about 7.6 billion roubles (US$240 million). The cases now flaring up in Russia, Ukraine and other countries in the Caucasus have their origins in a 2007 outbreak in the former Soviet republic of Georgia, where the virus gained a foothold after being imported from Africa. The disease quickly jumped to neighbouring Azerbaijan, Armenia and Chechnya, before fanning out across Russia. The recent spread of the virus means that the Ukrainian outbreak, now under control after authorities culled 208 pigs and instituted quarantine measures, did not come as a surprise. Nearby countries, such as Moldova, Belarus and the Baltic states could be next. To the east, the disease has been detected on the doorstep of Kazakhstan, which shares a long border with China, home to more than 1 billion pigs. China also risks importing the virus through its growing trade with African nations. The FAO warns that the continued spread of African swine fever could be very costly. Russia does not export its pork, but trade restrictions could prove expensive for other countries where the disease becomes endemic. "If you are a small producer, and you lose all your five pigs, that is devastating to the family." Denis Kolbasov, director of the National Research Institute for Veterinary Virology and Microbiology of Russia in Pokrov says, "Officials often have little appetite for expensive countermeasures such as widespread culling and quarantine that could disrupt Russia's billion-dollar pork industry". Meanwhile, backyard farmers often do not report suspected cases for fear of losing their livelihood. (Source: Nature 488, 565–566, 30 August 2012)
More Danish pigs
On September 11, 2011 the third lot of foreign pigs arrived at Baykal airport in Buryatiya. 1, 474 animals were delivered by plane to Vostochno Sibirskyi pig complex (East Siberia). The pigs travelled a distance of 7,390 km by air. The breeds include Large White as well as F1 gilts. The fourth and the last lot are expected to arrive in October 2012. (Source: BMK)
Spain
Vall Companys buys Cárnicas Cinco Villas
Vall Companys reinforces its position with the purchase of the major abattoir near Zaragoza. Vall Companys already owns three other major abattoirs and processing plants in Barcelona (Patel), Cuenca (Frivall) and Ciudad Real (Frimancha). Cinco Villas has a capacity of 16,000 pigs per week. (Source: Expansión)
Boadas expands
Pork processor, Boadas 1880 (Girona) is investing €2 million in its plant. The company has a turnover of €26.6 million and produces 2,500 tonnes of processed pork products, a large proportion of which is exported. (Source: Alimarket)
Viscofan affirms its leadership
This major Spanish company from Navarra exports casings to 100 countries and owns factories in Germany, Brazil, China, Mexico, Czech Republic, Serbia and the USA. It produces two thirds of the hot dogs casings in the United States. The Group has doubled its turnover over the last three years and just announced a net profit of €113 million. It is now the world leader in artificial casings with 4,000 employees. It is best known in the UK for the German Naturin brand and production acquired in 1990. (Source: Expansión)
|
Pork prices Barcelona Market Week commencing 10 September 2012 | |
|
Cut Name |
Price range (Euro/Kg) |
|
Gerona Loin Chops |
2,95/2,98 |
|
Loin Eye Muscle |
--/-- |
|
Spare Ribs |
3,13/3,16 |
|
Fillets |
5,43/5,46 |
|
Round Cut Legs |
3,06/3,09 |
|
Cooked Ham |
2,50/2,53 |
|
Rindless Picnic Shoulder |
1,91/1,94 |
|
Belly |
2,50/2,53 |
|
Smoked Belly with Spare Rib Section Cut off |
2,93/2,96 |
|
Shoulder chap or Head Jowls |
1,53/1,56 |
|
Back Fat, Rindless |
1,38/1,41 |
Ukraine
Pork production up
Total Ukrainian pig meat production is expected to reach 750,000 tonnes, which represents an increase of 50,000 tonnes or 7.1% compared to 2011. Mr. Andrey Getya, Ukraine's Animal Husbandry Department Director at the Ministry of Agrarian Policy and Foodstuffs said that today domestic pork dominates on the Ukrainian market and during the past two or three years imports of pork into Ukraine decreased. The price for live pigs remains high so import is not a hurdle for domestic farmers. (Source: RBK-Ukraina)
Exports into the EU targeted
Due to expected frequent import restrictions to their main export markets, Russia and Kazakhstan, Ukrainian beef and pig meat producers are exploring potential new export opportunities. A focus is set on the EU countries with the aim being to sell high quality products into the EU because cheap products are sold on the domestic market. However, even though some of the main producers are already working on fulfilling the veterinary requirements for exports to the EU member states, it might be a while before they get approved as negotiations regarding a free trade agreement between Ukraine and the EU are stagnating. According to agrarzeitung, this is partly due to the political developments in Ukraine. (Source: ISN)
USA
New price reporting system
The USDA has announced its new mandatory wholesale price reporting requirements as required by the Mandatory Price Reporting Act 2010 to take effect from 1 January 2013. The rule requires abattoirs to submit the price of each sale, quantity and other characteristics that the Agricultural Marketing Service will use to produce market reports. This also applies to beef, lamb and imported lamb. (Source: Agra Europe)
Huge losses in American pig production
At present the American market is characterized by large supply of porkers and sows and a price level, which is somewhat below production costs. "Livestock Marketing Information Center" (LMIC) at Denver, Colorado, calculated that in August the supply of pigs to the slaughtering markets was 9.74 million pigs, which is the highest number of slaughterings since December 2011 and the highest August number ever. According to farming economist Ron Plain, Purdue University, the American pig producers this summer will lose approximately $30 per pig and there is a high risk that the loss may increase even further during October quarter when pig prices are expected to decrease. A loss of $33 per pig corresponds to an aggregate loss of $4 billion in the American pig meat industry according to Ron Plain's calculations.
US$1 = EUR0.76 (September 18, 2012)
