Concerns over African Swine Flu (ASF) and trade embargoes over Ukraine's Crimea crisis have largely cut EU's pork deliveries to Russia, the bloc's biggest export market. However, the situation proves to be a blessing in disguise for Europe as pork exports to Asian markets rose, thus challenging the US pork's presence in the region.
With weaknesses in the euro and EU pork prices, significant and increased volumes of European pork deliveries had found their way into Japan (337,655 tonnes, up 35%), the Philippines (163,521 tonnes, up 94%) and South Korea (229,345 tonnes, up 98%).
While the volume of its EU pork imports was dwarfed by other countries, Taiwan witnessed the largest increase among the markets, with a whopping 306% rise to 43,132 tonnes.
The EU also saw its share of the pork market in China / Hong Kong increased to 64% in 2014, compared to 59% in 2013. Deliveries to these markets went up by 7%, to a volume of 1.19 million tonnes.
Positive trends in Asia help to bolster EU's pork exports which, without the Russian market, could only manage a 1% increase in deliveries, to 2.75 million tonnes in volume. This year, EU pork exports to Asia reached 687,544 tonnes in March, a 12% lead over 2014.
EU's growing prominence in the Asian pork market did not escape the attention of the Pork and Allied Industries Committee of the US Meat Export Federation (USMEF). In a recent meeting, Jihae Yang, USMEF-Korea's director, noted of aggressive efforts by German and Spanish suppliers to raise the range of pork cuts delivered to South Korea, particularly the introduction of picnics and collar butts into the market. The move induced a stronger competition against US pork, especially in the processing sector.
Hence, boosting customer loyalty among Korean pork processors will be one of the critical issues addressed this summer, through financial support from the Pork Checkoff. The supplemental funding will also strengthen promotion of US pork to the Korean barbecue restaurant sector, a key buyer of collar butts.
Elsewhere in Asia, European suppliers were also pushing for the sales of 'frozen-then-thawed' pork in Japan, supposedly a cheaper option compared to chilled pork of which the US is in an advantageous position of supplying to the country for a long time. This prompted a Pork Checkoff-backed strategy that calls for the promotion of 'fresh, never frozen' US pork to leading Japanese retail chains.
In addition, there were concerns over developments, transpiring from free trade agreement (FTA) talks between Japan and the EU, which could have implications for the US pork trade. Specifically, a potential lowering of duties on EU pork deliveries to Japan will further intensify competition with US pork due to a weaker yen and euro as compared to the US dollar.