September 11, 2017

Global pork export prices continue upward trend in Q2   

Global pork export prices continued to move upwards in the second quarter, AHDB Pork reported.

It said that based on the four largest global pork exporters (the EU, US, Canada and Brazil) the average value of pork traded reached US$2.75 per kilogramme in June. This was 9% ($0.23/kg) above year-earlier levels and the highest level since January 2015.

The rise in prices was particularly driven by a sharp increase in the value of EU pork exports between April and May, following steep increases in European farmgate prices, reflecting a tight supply situation.

EU export prices were, on average, the highest of the four largest global exporters in the first six months and were a substantial 6% above the overall average in May alone. As such, the competitiveness of EU pork was the lowest since February 2014 during this month.

While the EU price rose strongly, other global pork export prices increased moderately, remaining competitive. The Canadian price, particularly, grew throughout the second quarter by just $0.25/kg, as the Canadian dollar appreciated, while the US price gained even more modestly by $0.05/kg. Strong domestic demand has also been supporting pork prices in these key producing nations.

The exception to the overall increasing trend was Brazil, which reported price declines following the peak in April, partly due to the weakening reputation of Brazilian product, as well as a devaluation in the Brazilian real.

The overall amount of pork traded was 14% lower than year-earlier levels during the second quarter, mainly reflecting the weaker Chinese demand. Despite this, according to the pork division of the UK Agriculture & Horticulture Development Board, it seemed that supplies on a global basis have so far been far from plentiful, which has supported prices. How long this can continue remains uncertain, AHDB Pork added.