October 22, 2020

 

Germany increases pork sales inside the EU

 

Meat processors in Germany are channeling pork products such as pork chops and bacon to supermarkets across the European Union, products that have been reserved for Asia after China, Japan and South Korea banned German pork imports, Reuters reported.

 

German pork imports were banned by the Asian countries after Germany reported its first African swine fever (ASF) case on September 10. All ASF cases have only been detected among wild boar in the eastern state of Brandenburg.

 

Swine prices in Germany crashed 14% after the first outbreak was reported, but prices have since stabilised at a lower level.

 

German pork is now only sold within the EU, with Spain, Denmark and the Netherlands boosting sales to China following the gap left behind by Germany.

 

German pork margins for selling to Europe is smaller than China, especially as cuts such as ears and feet is only consumed in Asia.

 

However, there are opportunities to sell swine cuts such as shoulder meat and hams, originally reserved for Asia, now being sold to the EU as rival EU pork producers boost sales to China.

 

Andre Vielstaedte, spokesman for Toennies, Germany's largest processor, said there are growing sales but it is not sufficient to make up for losses.

 

The additional pork supply in Europe is putting downward pressure for prices on certain pork cuts.

 

Patrick de Leede, a spokesman for the Dutch association of meat producers, said with more German pork in Europe, there is an oversupply of popular parts like bacon, pork chops and tenderloin which are pushing prices down.

 

De Leede said there are increased pork exports to China from the Netherlands, mainly for parts such as heads, legs, and tails.

 

Daniel de Miguel, director of business association INTERPORC's international arm, said Spain's pork exports to China has steadily grown before Germany's ASF outbreak.

 

662,261 tonnes of pork has been exported from Spain to China in the first seven months of this year, two times higher than last year according to de Miguel.

 

Danish Crown, another major pork exporter, said the company has seen increased sales to China but does not have spare capacity to boost exports further for now.

 

Germany is currently in discussion with its important Asian purchasers to amend the ban to a regional ban only in affected ASF states. This approach is currently taken by the EU, which means Germany can continue to export to major European purchasers like Italy.

 

A spokesman for German meatpacker Mueller Group said the entire Germany should not be subjected to an export ban, adding that prices should stablised or it would affect the country's entire pork production.

 

China's customs data showed the country imported 3.29 million tonnes of pork meat between January to September this year, up 132% year-on-year.

 

Justin Sherrard, global strategist for animal protein at Rabobank, said China could slow down pork purchases as the country's own swine herd recovers.

 

-      Reuters