November 7, 2012

                                                                                          

BPEX Export Bulletin - November 2012 (Week 44)

 

 

This week's export news

 

Over the next two weeks, BPEX will be present at the MesoMania exhibition in Sofia and the Food & Hotel China (FHC) Exhibition in Shanghai. We were last present at the Bulgarian show in 2010. This small specialised meat fair organised by the Bulgarian Meat Processors' Association, is a useful meeting point for Balkan meat importers. In Shanghai, the BPEX-EBLEX stand will form part of the UK pavilion and for first time in China we will be serving local dishes prepared using British pork. The FHC event will also include an evening reception for Chinese food importers and distributors.

 

 

Denmark

 

Market

 

The European markets for fresh meat are being affected by the negative autumn mood. Prices for legs and fore end cuts are coming under some pressure from buyers. The market for loins is sluggish but, so far, has remained stable and the UK bacon market also remains unchanged. Exports to third-country markets remain satisfactory. (Sources: Danish Crown, Tican, Danish Food Council).

 

New CEO with Nove in Poland

 

Peter Soerensen has been appointed as CEO for Nove in Poland, previously, he ran his own business. Nove is the Polish subsidiary of Tican, producing meat and cold cuts for both the Polish and export markets. (Source: Tican)

 

Danish Crown issues corporate bonds

 

Danish Crown is the first Danish company to offer corporate bonds on the new First North Bond Market at the Copenhagen stock exchange. Danish Crown sold bonds to the value of €93 million during the first tender day. Danish Crown emphasised this should be seen as an indication of Danish Crown's commitment to broad-based financing. (Source: Danish Crown, Landbrugsavisen)

 

Improved earnings in piglet production

 

The price of piglets in Denmark is forecast to increase significantly in 2013. Hans Aarestrup, director of the Danish Pig Producers, presented predictions at the annual meeting of the Pig Research Centre.  He estimates that the calculated average price will rise to €57 for 30kg piglets in 2013, an increase of €4.40 compared with 2012 average prices. The main driver for the increases is the predicted fall in production within the EU as member states phase in the 2013 regulations. (Source: Landbrugsavisen)

 

Danish Slaughterhouses - payments week commencing 29 October 2012
Slaughterhouse	Danish Crown	Tican
Slaughter pigs (70.0 - 86.9 kg)	Euro 1.627	Euro 1.627
Difference to last week	-0.027	-0.027
Sows (Above 129.9 kg)	Euro 1.225	Euro 1.225
Difference to last week	-0.04	-0.04
Boars (Above 109.9 kg)	Euro 1.055	Euro 1.055
Difference to last week	-0.04	-0.04

 

 

Netherlands

 

Improved image for pork production

 

A survey commissioned by Varkens in Zicht, the Dutch organisation for pig farm open days, reveals a steady improvement in the image of pig production. In 2007, 41% of respondents believed that methods of pig production required improvement compared with 27% today. See www.stapindestal.nl.

 

Westfleisch listed for Beter Leven

 

The Coesfled abattoir is now able to supply pork accredited to Beter Leven welfare standards on to the Dutch market. (Source: Boerderij Vandaag)

 

 

France

 

Charcuterie market:

 

Organic

 

The Organic segment of the French charcuterie market is suffering. In volume terms, the market decreased by 2% to 3,116 tonnes. Own brand market share decreased by 1.9% representing 62.3% of the market. The performance of the market leader, Fleury-Michon, with a 24.5% market share, is also down marginally by 0.1%.

 

Label Rouge

 

The quality mark segment is dominated by Label Rouge, supply of this label decreased by 5.9% in volume to 2,874 tonnes. Own brand market share has decreased by 10.1% to 57.7%. The position of the leader, Fleury-Michon, also suffered with a 9.4% fall in share accounting for 30.5%. Label Rouge is still a quality scheme benefiting from a very high level of awareness with consumers over 65. However, as advertising budgets have been significantly reduced over the last ten years, awareness is decreasing with younger consumers. In contrast, a segment that is increasing is halal charcuterie. A very active leader, Isla Délice, has increased market share by 16.7% and now accounts for 38.3% of the total market of 8,613 tonnes of processed poultry products.

 

Saucissons secs

 

The famous French dry sausage, saucissons secs and saucisses sèches, is the second largest charcuterie product despite being a long way behind cooked ham leg and shoulders. By the end of July 2012, this market had increased by 5.6% in value and by 3.2% in volume. Segmentation was the key element of the marketing strategy of the main manufacturers, including Bongrain, Aoste, Bordeaux Chesnel, Justin Bridou.

 

Market data for pigs and piglets

 

Pigs

 

Piglets

 

Cuts

 

The market for meat is very calm due to the end of the month, combined with school holidays. Sales should be better by the end of the week.

 

Germany

 

Market

 

There is some optimism that the downward trend will come to an end, despite some market uncertainty. The most recent quotation is relatively firm at €1.87kg. (Source: various)

 

Pig exports to Poland are booming

 

The export of slaughter pigs and weaners from Germany in 2012 is estimated to reach 3.5 million head. This will be a new record and represents an increase of 19% compared with year earlier levels. Currently, demand is increasing from Poland, Czech Republic and the Ukraine. (Source: AMI)

 

Pork prices Hamburg Market Week commencing 29 October 2012
Cut name	Price range (Euro/Kg)
Round cut leg	2.38/2.50
Leg (boneless, rindless max fat level 3mm	3.20/3.40
Boneless Shoulder	2.90/3.00
Picnic Shoulder	2.40/2.50
Collar	2.40/2.60
Belly (bone in, ex-breast)	2.65/2.80
Sheet Boned Belly (rindless)	2.50/2.75
Jowl	1.55/1.80
Half Pig Carcasses U class.	2.23/2.33

  

 

Spain

 

Lower exports dampen the market

 

Weaker demand from China and Russia is putting some pressure on the Spanish pork market following the September peaks. However, exports of fifth quarter products to China are reported to be buoyant. (Source: Mercolleida)

 

Food service sales higher than expected

 

Spanish people allocate 29% of their food spend to restaurants, similar to pre-2007 financial crisis levels. Although they currently visit eateries less frequently during the week, people spend more eating out over the weekend. (Source: Eurocarne)

 

Pork prices Barcelona Market Week commencing 30 October 2012
Cut Name	Price range (Euro/Kg)
Gerona Loin Chops	2.75/2.81
Loin Eye Muscle	3.78/3.81
Spare Ribs	3.03/3.06
Fillets	5.43/5.46
Round Cut Legs	2.88/2.91
Cooked Ham	2.71/2.74
Rindless Picnic Shoulder	1.92/1.95
Belly	2.54/2.57
Smoked Belly with Spare Rib Section Cut off	2.97/3.00
Shoulder chap or Head Jowls	1.43/1.46
Back Fat, Rindless	1.18/1.21

 

 

Portugal

 

Food sales maintained

 

When comparing sales between July 2010 and June 2012, food sale volumes are being maintained and have even experienced a small increase of 0.8%. In contrast, non-food sales plunged by 8.8% over the same period. In relation to processed pork products, local marketers report higher pre-packed sliced meat sales, up 3.3% and lower dry-cured ham sales, down 5.6%. Low priced products registered the strongest growth. (Source: Distribução Hoje)

 

Interest in exports

 

Portuguese pork processors are at last taking a keener interest in exports. Market leader, Nobre, has increased exports by 30% this year which now represent 10% of their turnover according to CEO Rui Silva. The company now exports to 26 countries. Other processors report annual growth of between 10 and 20%. (Source: Distribução Hoje)

 

Portuguese quotes resist

 

At €2.05, the Portuguese price remains the highest in Europe after, of course, Italy. However, the price is following the Spanish trend, easing by around €0.05 over the past two weeks. (Source: Mercolleida)

 

 

Austria

 

Falling production

 

In 2012, the Austrian pig population is projected to decline by 2.3% to 4.98 million head, according to forecasts from the Federal Institute of Agricultural Economics. In the first two quarters of 2013 production, it is estimated to decline by 2.1% and 1.1% respectively compared with the same two periods of 2012. (Source: AMI)

 

 

Russia

 

Zero tax on farm profits

 

Russian President Vladimir Putin signed a law that extends a 0% tax on farm profits ad infinitum. The tax break also includes a reduced VAT rate, of 10%, on farm goods. The move has been welcomed by large investors in the sector. (Source: expert.ru)

 

New complex to be built in Krasnoyarsk

 

The Russian company, Sangilen, is planning to build a pig-breeding complex in Krasnoyarskiy Krai, due for completion by October 2013. The total cost of the project is estimated at US$33.7 million. Target capacity for the complex will be 1,450 tonnes of pork per year. The Italian company, Evoteck, has been contracted for construction.  (Source: PigUA.info)

 

 

Ukraine

 

State Agency purchases tinned pork

 

The State Reserve Agency purchased 159,000 tins of tinned pork sourced from pigs slaughtered during the ASF outbreak. The pork was manufactured by Berdainski Kovbasy Ltd. on the approval of the State Veterinary and Phytosanitary Service of Ukraine. (Source: PigUA.info)

 

Increased profit for Globynsky meat

 

Globynsky meat is one of the biggest Ukrainian meat-processing enterprises. Reported net profits for January to September 2012 of UAH 12.2 million were nearly 6 times higher, compared with the results in the corresponding period in 2011. (Source: PigUA.info)

 

 

Brazil

 

Processors are struggling

 

JP Morgan has downgraded prospects for the two main poultry and pork processors, BRF and Marfrig.  Debt and the loss of profitability as a result of higher grain prices are the reason behind the downgrade. However, the Bank of America is more positive for Marfrig, with the possibility of asset sales or the capitalisation of Seara. The company aims to save R$130 million (£40 million) per year with the new payroll tax relief scheme (Source: Brazilian Meat Monitor)

 

Pork exports rebound

 

After a long period of stagnation and retreat, pork exports in September were 55% higher. The main market has become the Ukraine. (Source: Brazilian Meat Monitor)

 

 

China

 

Brazil Foods invests

 

BRF (Brazil Foods) will begin construction of a processing plant for poultry and pigs in China in late 2013. The investment will be made in partnership with the Chinese group, Dah Chong Hong (DCH), controlled by state-owned Citic Pacific. BRF and Citic Pacific began operating a joint venture earlier this year (see bulletins passim). According to Antonio Augusto de Toni, vice president of external markets for BRF, the plan is that the new unit will begin operation in late 2014. (Source: Valor Economico)

 

 

US$1 = EUR0.78 (Nov. 7, 2012)