September 17, 2014

Due to sanctions following the Ukraine-Russia territorial crisis, the EU is expected to suffer a loss of about 15,000 tonnes in beef exports to Russia during the second half of 2014, Agrimoney.com reported.

However, a USDA source believes the bloc will be able to find alternate markets for such supplies.

"Exports to other third countries destinations, mainly to the Balkans and Hong Kong, rose by nearly 20,000 tonnes during the first half of 2014," said the unnamed staff. Still, the forecast assumes that EU beef output will drop to a 48-year low, at 7.49 million tonnes in 2015. The decline reveals a beef herd shrinking below 12 million head, thus extending a long-term decline.

On the other hand, pork exports are likely to face more challenges due to recent sanctions imposed by Russia and an earlier incidence of African swine fever outbreak in the eastern region of EU.

In 2013, the EU exported 667,000 tonnes of pork to Russia, Belarus and Ukraine, with shipments to the latter two countries suffering as a result of the swine fever outbreak.

Additionally, the pork trade to China and Hong Kong are said to be stagnating, according to the USDA staff. Rising volumes to Japan, South Korea and the US are also insufficient to counterbalance the lower sales to Russia, Belarus and Ukraine.

In the meantime, Europe's pork industry may face a drop in sow herd to an estimated 12.48 million head in 2015, down from 17.09 million in 1999. The decline is blamed on the impact of improved animal welfare requirements.

Adding to the sector's woes are decreasing piglet productions which are expected to fall by 800,000 head in Poland from 2012-14, and 600,000 head in Italy.

On a positive note, the Benelux states, Denmark, Germany, Spain and the UK will see an output rise of a combined two million head of piglets.