October 18, 2021

 

EU produces more pork in first half of 2021

 

The EU pork market is in a difficult situation due to increased production but decreased demand from food services and China, according to the European Commission.

 

Due to COVID-19 disruptions in 2020, the slaughtering statistics in the first half of 2021 show a significant production increase in major producing countries.

 

In Germany, the loss of the Chinese market due to ASF and the resulting price decline had an impact on production (-1.2%). Overall, EU pork production increased by 466,000 tonnes in the first half of 2021 (+4.1% year-on-year).

 

In response to this situation and faced with increasing feed costs, the EU pork sector is expected to slow down production. The 2021 yearly production growth is forecast at +1.7% year-on-year. In 2022, that trend could continue, with a projected yearly growth of +0.6%.

 

EU pork prices peaked in June and since then, have fallen steadily, down to almost €140/100kg (US$162.17) in September. These low prices negatively impact the EU pig farmers' margins but give EU pork a comparative advantage on the world markets.

 

EU exports to China, the main destination for EU pork, continued to increase in the first half of 2021 (+157,000 tonnes or +14% year-on-year).

 

EU exports also significantly changed to other destinations: Asia (Philippines, +260%; Vietnam, +100% - as African swine fever reduced domestic production in both countries; Hong Kong, +38%), America (Chile, +1600%; the United States, +37%), Oceania (New Zealand, +72%; Australia, +42%), Ukraine (+18%), the United Kingdom (-10%) and Japan (-13%, partly due to restrictions in foodservices ahead of the Olympics).

 

In volume, the net increase of EU pork exports to those destinations amounted to 121 000 tonnes year-on-year (+14%).

 

Overall, EU pork exports are projected to remain dynamic, with a 6% increase in 2021 and +7% in 2022.

 

The EU export situation will be strongly influenced by the developments on the Chinese market, which has entered a situation of oversupply following a temporary reduction in stocks, in part to upgrade the sow herd.

 

- European Commission