November 14, 2012

                                                                                          

BPEX Export Bulletin-November 2012 (Week 45)

 

 

This week's export news

 

With the major livestock show, Eurotier in Hanover, Germany, taking place this week, following the successful CAHE fair earlier in this year in Nanjing, China, strong sales are being generated by British pig breeders this autumn. PIC will send 4,500 GPs, from four Chinese nucleus farms to a new breeding farm in Shaanxi province operated by the Besun Group. Meanwhile, JSR have strengthened their position in China by signing a franchise deal with Tianjin Bo Hui Rui Kang Livestock Breeding Ltd based in the Jinnan district of Tianjin of Northern China. ACMC has also announced a major deal for pig semen to Mexico.  The British pig breeding sector will, once again, host a reception in Hanover for the Chinese Animal Agriculture Association. A Chinese mission will visit the UK in December to inspect porcine AI centres.

 

 

Denmark

 

Market

 

European market trading has been reported as difficult due to increased supplies of pigs and a somewhat subdued demand with a "wait and see" attitude ahead of the Christmas trade. Fresh legs, fore-ends, shoulders and collars are being traded at lower prices. Loins are also under pressure on European markets, but at stable levels to third-countries. The bacon market in the UK is under pressure on the spot market, while contract sales are stable. Trade to Japan and China is reported stable, while exports to Russia are more hesitant. (Sources: Danish Crown, Tican, Danish Food Council).

 

Restrictions on antibiotics and stricter welfare

 

The Danish Government adopts new veterinary rules to tighten up antibiotic use in agriculture and to increase animal welfare standards. The regulations include the use of drugs on groups opposed to individual animal treatments, an important part of the fight against antibiotic-resistant bacteria. The solution is designed to focus on farmers where the problems are most serious, says the Food Minister. (Source: Fødevareministeriet)

 

Danish Slaughterhouses - payments week commencing 05 November 2012
Slaughterhouse	Danish Crown	Tican
Slaughter pigs (70.0 – 86.9 kg)	Euro 1.587	Euro 1.587
Difference to last week	-0.04	-0.04
Sows (Above 129.9 kg)	Euro 1.185	Euro 1.185
Difference to last week	-0.04	-0.04
Boars (Above 109.9 kg)	Euro 1.015	Euro 1.015
Difference to last week	-0.04	-0.04

 

Netherlands

 

Stable production

 

The number of Dutch sows has fallen from 1.1million head in 2000 to 937,000 head in 2012. However, increased productivity means that the number of weaners produced has increased from 25.5million to 25.9million head. (Source: Boierderij Vandaag)

 

 

Germany

 

Market

 

Prices appear to have reached their low point; a consistent supply of pigs is forecast and therefore, the market is predicted to remain stable. Further impulse is predicted as pre-Christmas business drives demand.

 

German pork exports continue to boom

 

In the first 8-months of 2012, German pork exports exceeded 1.8 million tonnes, an increase of 40,000 tonnes, or just over 2% on-year. In the first quarter, shipments were 9% higher while August exports were similar to year earlier levels. Despite a fall in shipments, Italy remains the leading destination with 12% market share; the Netherlands is the second largest destination with 11% of the market. Higher exports were recorded to the UK and Denmark, up 17% and 25% respectively.

 

530,000 tonnes of pork were shipped to third-countries, marginally down on-year. The largest customer was Russia with 170,000 tonnes. Although exports have been down, a boom in demand has been reported since Russia's WTO accession in August. At 103,000 tonnes, China is the second largest third-country destination followed by Hong Kong at 101,000 tonnes. (Source: ISN)

 

Pork prices Hamburg Market Week commencing 05 November 2012
Cut name	Price range (Euro/Kg)
Round cut leg	2.38/2.50
Leg (boneless, rindless max fat level 3mm	3.20/3.40
Boneless Shoulder	2.90/3.00
Picnic Shoulder	2.40/2.50
Collar	2.40/2.60
Belly (bone in, ex-breast)	2.65/2.85
Sheet Boned Belly (rindless)	2.50/2.78
Jowl	1.55/1.80
Half Pig Carcasses U class.	2.23/2.33

 
France

 

High welfare pigs

 

A "Porc Bien Etre" initiative was launched in September by Cooperl Arc Atlantique, following a two year project with 40 producers and 60,000 pigs. The French cooperative worked hard to set up non castrated pig production. Boar taint is managed by specific genetics, feeding regimes and herd management. Pigs are also removed from the kill line when taint affected carcasses are identified. Cooperl Arc Atlantique need to compete with Dutch, German and Spanish producers who are already supplying non castrated pigs to charcuterie manufacturers, allowing producers and consumers to choose welfare friendly supply chains which is a growing trend in France. Cooperl Arc Atlantique did not involved Inaporc, the inter-professional body in the project and could be criticised for not strategically debating an issue that could influence the French pig production.

 

Restructuration

 

On 30th October, the French pig industry led by its President Guillaume Roué, alerted the French government of serious difficulties being faced by the sector. The competitiveness gap between France and other member states has become a major issue. The gap is estimated at €10 per hour and the loss to the processing sector is estimated at €100 million.

 

A working group managed by Alain Berger, Ministry of Agriculture, will be set up to seek solutions to improve the situation including:

 

 - Slaughter restructure - processing activity

 

Market

 

Pigs

 

After a difficult trading month in October, industry hopes November will be better month. According to "le Marché du Porc Breton", "October ended by a reduction in slaughtering which was more moderate than in September, 2,8 % less (11,000 pigs) a week". Supplies could be less important in the days to come as demand improves, in particular on export markets. For producers, facing increased production costs, an increase in demand is crucial. According to MPB, "the cost price for pigs in October was close to €1.70 and could be €1.80 in November or €1.65 basic price".

 

Cuts

 

Euphoria is not appropriate for slaughterhouses, but an improvemed situation is noted. The market is more dynamic in France and on export markets; a tendency which the operators hope to see confirmed.

 

Pork prices RUNGIS week commencing 05 November 2012
Cut name	Price range (Euro/Kg)
Back fat, rind-on	0.85
Trimmings	1.73
Leg	2.83
Loin including chump	3.02
Loin excluding chump	2.85
Belly extra without trimmings	2.79

 

Spain

 

Increased stability

 

After weeks of turbulence on the European market and recent falls, a more stable price level has been reached with adequate demand from Northern Europe balancing supplies. Some international buyers were said to be holding their purchases but, are now likely to come back to the market. (Source: Mercolleida)

 

Pork prices Barcelona Market Week commencing 05 November 2012
Cut Name	Price range (Euro/Kg)
Gerona Loin Chops	2.65/2.68
Loin Eye Muscle	3.58/3.61
Spare Ribs	2.98/3.01
Fillets	5.43/5.46
Round Cut Legs	2.73/2.76
Cooked Ham	2.64/2.67
Rindless Picnic Shoulder	1.89/1.92
Belly	2.54/2.57
Smoked Belly with Spare Rib Section Cut off	2.97/3.00
Shoulder chap or Head Jowls	1.38/1.41
Back Fat, Rindless	1.13/1.16

 

Austria

 

Wiesbauer's spectacular

 

The pork processor was one of the sponsors of this year's Wiener Wies, Vienna's answer to the Oktoberfest. Some 160,000 people attended the beer and sausage festival. Wiesbauer's tent, with capacity for 1,600 people, featured a 20 metre long reproduction hanging room showcasing salami. (Source: Östrerreische Fleischer Zeitung)

 

 

Russia

 

Gvardia Ltd. purchased US pigs

 

The Press Service of the Ministry of Agriculture in Stavropolsky Krai released information on the purchase of 1,243 breeding pigs from the USA by Gvardia Ltd. This is the second batch of breeding pigs purchased from the USA this year. Gvardia Ltd. is one of the biggest investment projects in Stavropolsky Krai, the project is for completion early in 2013. (Source: FederalPress)

 

 

Ukraine

 

Higher retail pork prices

 

Significant increases in retail pork prices were reported in Donetska oblast. As a result, the average price increased to US$7.30 per kg. Retailers report the main driver for the increase was higher feed prices. Market experts predict prices to be 7% to 8% higher by the end of the year. (Source: PigUA.info)

 

 

China

 

US pork exports rocketing

 

In the first seven months of 2012, the country exported 159,706 tonnes (+79% in volume and +109% in value) to mainland China and Hong Kong. This has been offset by lower exports to other Asian markets. (Source: Asian Pork)

 

 

Vietnam

 

Foreign feed producers dominate

 

There are now 57 foreign feed manufacturers, 41 wholly-owned and 16 joint ventures representing 60% of feed output. Foreign companies have better access to capital and technology. (Source: Asian Meat)

 

 

Indonesia

 

Pork production banned

 

West Java and Batam Island have banned pig production, the reason given is environmental. However, in reality the majority of the population of West Java and Batam are Muslim. (Source: Asian Pork).

 

 

US$1 = EUR0.79 (Nov. 14, 2012)