December 4, 2013

Due to declining demand in the local market and parts of Europe, China's increasing meat demands may help boost Romania's cattle and pork industry.

Chinese officials last week signed two agreements to import 500,000 cattle and three million pigs from Romania over the next few years.

Premier Li Keqiang, on his visit to Bucharest, said China also wanted to import sheep and possibly other food produce. "We can buy all you can deliver," Li said after talks with Romanian counterpart Victor Ponta.

Chinese diet was radically changed by the fast-paced urbanisation and development of a middle class, with meat increasingly replacing or complementing rice and vegetables.

In their 2013 Agricultural Outlook, the Organisation for Economic Cooperation and Development (OECD) and the United Nations' Food and Agriculture Organisation (FAO) said meat demand in China would continue to rise in the next 10 years, in line with rapid expansion of household refrigerators.

In rural northern Romania, breeder Dumitru Grigorean said China's plan to import livestock was good news. He said he had invested some €80,000 (US$108,000) in his farm, buying 70 French meat cows, and expected to start seeing a profit two years from now. He added that several members of his cattle breeder association, who own up to 2,000 head of cattle each, were set to export cows to China.

But Dragos Frumosu, the leader of the food industry trade union, said Romania did not have enough cattle to meet Chinese demand. "The solution would be to set up joint farms with Chinese capital or encourage local farmers to expand by using more EU funds," he said.

Agriculture minister Daniel Constantin said Romania's cattle stock had dropped sharply from 2.8 million in 2001 to 1.2 million this year. But he added that the government earmarked €830 million (US$1.1 billion) of public funds and European money to help breeders increase their stock.

Romania currently imports up to 70% of its beef consumption and some 50% of pork consumption, but also exports cattle and sheep mostly to Arab countries. Constantin said Romania would have no problem exporting sheep as it has a surplus of around five million heads.

Shuanghui International's recent takeover of Smithfield Foods in the US, which owns a pork producer near Timisoara in western Romania, will partly solve the pork exports issue. The former Smithfield's Comtim farm breeds some one million pigs, out of a total of 5.7 million raised in Romania.