Government to Reduce Food Import Bill
19 April 2013

JAMAICA - The Ministry of Agriculture and Fisheries will be pursuing initiatives aimed at enhancing Jamaica’s food security and reducing the country's annual food import bill of US$1 billion.

Portfolio Minister Roger Clarke identified some of the imported items, that "take a big chunk out of our import bill”, as wheat flour, corn, animal feed, rice and some fish products.
 
He said that the establishment of the eight Agro Parks will make a significant contribution to agricultural development, while moving towards food security.
 
“In these Agro Parks, the government will be working towards putting in basic infrastructure, such as irrigation, drainage, storage, and packing house facilities. We will be concentrating extension officers in those specific areas to deal with production, so that the farmers can have a continuous linkage with their extension officers,” Mr Clarke stated.
 
Over the next three years, some US$8 million will be invested to develop the parks in six parishes, including St. Thomas, St. Catherine, Clarendon, Manchester, St. Elizabeth and Trelawny.
 
Focus will be placed on the production of onions, Irish potato, yam, honey, small ruminants, hot pepper, ginger, turmeric, pineapple, and on aquaculture.
 
In addition, Mr Clarke noted that the Ministry will seek to put in place a proper marketing strategy for the agricultural sector.
 
“We are even looking at an exchange, somewhat like the stock exchange, to deal with how we market our farm produce,” he said.
 
 

Grant for Polillo Farmers
26 April 2013

PHILIPPINES - The Department of Agriculture is allotting an initial P80 million for various agricultural and fishery projects to further increase the productivity and incomes of small farmers and fisherfolk in five towns comprising the Polillo group of islands, in Quezon.

Agriculture Secretary Proceso J. Alcala said such assistance is also aimed at making Polillo sufficient in rice, other staples, fish, vegetables and other crops. He led the distribution of various farm inputs, equipment, and projects to more than 1,000 farmers, fisherfolk and local government officials during a two-day visit, highlighted by an ‘Agriculture and Fisheries Development Summit,’ at Polillo town hall, on April 15, 2013.
 
He said the DA through its Region 4-A (Calabarzon) office and other concerned DA agencies are assisting the local governments of the five towns (Polillo, Jomalig, Patnanungan, Burdeos, and Panukulan) craft a medium-term agriculture and fisheries development plan or roadmap to make Polilians sufficient in rice and major staples.
 
"We need to expand the area planted to rice in each of the barangays in Polillo group of islands in line with the Aquino government's goal to achieve sufficiency in rice by end of 2013," said the DA chief. He asked Polillian farmers to coordinate with the DA’s Bureau of Soils and Water Management (BSWM), led by Dir Vince Tejada, to locate springs to be tapped as sources of irrigation, and establishment of small water impounding projects (SWIPs).
 
The bulk of the interventions consisted of P54.7-M worth of crop and accident insurance coverage from the DA’s Philippine Crop Insurance Corporation (PCIC), for farmers, fisherfolk and their families in the five towns of Polillo (P13.5-M worth of insurance), Jomalig (P15M), Patnanungan (P9.6M), Burdeos (P8.35M), and Panukulan (P8.25M).
 
For its part, the DA’s Bureau of Fisheries and Aquatic Resources (BFAR) provided P5-million worth of fish nets, fishing gears and paraphernalia.
 
Two barangay food terminals worth P2M will be established by the DA’s Agribusiness and Marketing Assistance Service (AMAS), while P1.5-M worth of farm equipment (hand tractors, water engine pumps, and coffee dryer), native pig and chicken, and a training module was allotted under the DA’s organic agriculture programme.
 
The DA rice and corn programmes gave P1.4-M worth of certified rice seeds (200 50-kilo bags worth P240,000), 150 bags of yellow and white corn seeds (P360,000), and dozens of farm equipment that included hand tractors, rice cutters, knapsack sprayers, collapsible dryers, and laminated tarps or trapal.
 
Polillian rural women and youth, who are members of Rural Improvement Clubs (RICs) and 4-H Clubs, also received P170,000-worth of livelihood projects from the DA’s Agricultural Training Institute.
 
During the forum, Secretary Alcala promptly addressed the concerns and issues raised by farmers and fisherfolk. He was assisted by head of DA agencies present that included Assistant Secretary and national corn programme coordinator Edilberto de Luna, PCA Administrator Euclides Forbes, PCIC President Jovy Bernabe, BSWM Director Silvino Tejada, BFAR Director Asis Perez, and DA Region 4-A Director Vilma Dimaculangan.
 
Secretary Alcala also raffled off to participants several head of farm animals (cattle, carabaos with implements piglets, sheep, and cattle), and hand tractors to each of the five municipalities in Polillo.

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Consumers Value Locally Sourced Food
03 May 2013

US - New research confirms that interest in locally sourced foods is taking hold among consumers who equate “local” with “fresh” and “healthier” and who want to support their local economy.

Yet definitions of “local” vary widely by age group and were found to encompass national brands, according to a survey commissioned by food industry marketing company Charleston|Orwig.
 
In the recent survey, consumers indicated that a national brand can be considered “locally sourced” based on where its growers/products are located (63 per cent). Nearly that many, 58 per cent , believe a national brand is “locally sourced” when it uses local sources for ingredients and products. About half of the restaurant operators surveyed agreed with both statements, at 55 per cent and 45 per cent .
 
Both consumers and operators said a brand can be considered locally sourced because units/sales help the local economy (27 per cent and 19 per cent). On the other hand, 21 per cent of operators and 17 per cent of consumers say a national brand can never be considered locally sourced.
 
When asked to define “locally sourced,” a majority of consumers responded “food or products from within their state.” Younger consumers, however, defined “local” as much closer to home, within five to 10 miles.
 
The new survey was inspired by 2012 Charleston|Orwig-sponsored research that found a majority of consumers had recently purchased locally sourced food. Interestingly, “local” was a more important consideration than “organic” and was cited as a key driver of “sustainability,” according to consumers surveyed last fall.
 
“It seems locally sourced is gaining ground around the country and certainly is a frequent topic among our clients and friends in the food industry,” said Mark Gale, Charleston|Orwig partner and chief executive officer. “We thought it was important to dig deeper into this trend and the insights from last year’s research.”
 
Safety First
 
The 2013 survey compared priorities between locally sourced food and brand, convenience, availability and cost. Datassential led the research, which surveyed more than 2,700 consumers and 300-plus restaurant and food-service operators.
 
As much as both consumers and operators value locally sourced, they identify significant hurdles to purchasing and offering local items including short growing seasons that limit stocks of fresh produce, price, and quality and safety concerns. Both groups agree that food safety is more important than locally sourced, with operators showing particular concern about food safety.
 
“The research suggests an opportunity for national brands to support chain and franchisee efforts to source some ingredients locally,” said Gale. “And national brands can source locally to appeal to consumers and operators who see the benefits of locally sourced, but are concerned about safety and availability.”
 
Gale noted that addressing locally sourced concerns is important for brands: one-third of consumers and one-quarter of operators in the Charleston|Orwig survey identified themselves as brand loyal. Half of consumers and two-thirds of operators said they are “somewhat” brand loyal.
 
The research further noted a correlation between retail purchases of locally sourced and demand for local foods when dining out. Nearly 50 per cent of the consumers surveyed by Datassential who “always” or “usually” purchase locally sourced foods for home use, also order local foods when eating out. But finding local items on restaurant menus may be difficult because nearly 60 per cent of operators surveyed indicated they do not include locally sourced or farm-identified items on menus because of seasonal availability and cost issues or safety concerns.
 
Fine and casual dining operators are most likely to offer local or farm-identified items, indicating an opportunity for quick-serve and midscale restaurants to address demand for locally sourced foods, Gale said.

Another Rise for Global Food Price Index
10 May 2013

GLOBAL - The FAO Food Price Index moved up in April for the second consecutive month.

The FAO Food Price Index averaged 215.5 points in April 2013, up two points (1.0 per cent) from its revised March value of 213.2 points and from April last year. At that level, the index is only nine per cent below the peak reached in February 2011. Similar to the price development in March, the April increase was driven almost exclusively by a sharp rise in dairy quotations, as meat prices rose marginally while those of the other food commodities fell.

The FAO Cereal Price Index averaged 234.6 points in April, down 10 points (4.1 per cent) from March but nearly 11 points (4.9 per cent) above the corresponding period last year. Most of the decline in April was triggered by weaker maize prices on expectation of higher closing stocks and favourable 2013 crop prospects. Wheat prices changed little, as the downward pressure stemming from expectation of larger inventories was offset by the upward pressure resulting from concern over the poor growing conditions and spring crop planting delays in the United States. Rice prices were marginally down, depressed by falling Indica rice quotations, while Japonica and, especially, fragrant rice prices moved upwards.

The FAO Oils/Fats Price Index averaged 199.0 points in April, down two points (1.5 per cent) from March. The decline was mainly led by palm and soy oil. Palm oil prices eased further reflecting abundant stocks held both by exporting and importing countries, and an expected acceleration in production. The decrease in soy oil prices reflects good progress in South America’s record soybean harvest, larger than anticipated inventory levels in the United States and initial forecasts of a record US soybean crop later this year. Furthermore, weakening energy prices and persistent global macroeconomic concerns continued to weigh on the vegetable oil complex as a whole.

The FAO Dairy Price Index averaged 258.8 points in April, a sharp rise of nearly 34 points (14.9 per cent) from March. The main cause of the price surge seen in recent months is a steep decline in New Zealand’s milk production, following an abnormally prolonged dry period at the start of the year leading to farmers drying off or culling milk cows early, which in turn caused a reduction in the processing of dairy products. The leap in prices is partly a reflection of the absence of commercial stocks to cater for such an unexpected reduction in availability, rather than a more profound shortage of supplies, as New Zealand’s overall output for the 2012/2013 (June-May) production year is projected to finish at record levels. In Europe, warmer weather during April has allowed cumulative milk production to return to the seasonal average in some countries.

The FAO Meat Price Index averaged 178.7 points in April, a level which it has maintained since the latter part of 2012, moving within the narrow band of 177 to 179. Nevertheless, meat prices overall remain high by historical standards: from the early part of 2011, the index has stayed above its previous peak of 170 reached in mid-2008. Quotations for the different types of meat showed some variation in April, with poultry and pork rising by one per cent and three per cent, respectively, despite a limited reduction in feed prices, and those of sheep meat and beef falling slightly.

The FAO Sugar Price Index averaged 252.6 points in April, down over nine points (3.6 per cent) from March. After rebounding in March, prices fell sharply in April mostly on expectation of a significant recovery in cane crop for the new crushing season in Brazil, the world’s largest exporter. With larger production of sugar expected to enter the world market and weaker import demand, sugar export prices were put under downward pressure.

Allendale Releases Cold Storage, Cattle on Feed Estimates
17 May 2013


US - Analysts at Allendale, Inc. have released their Cold Storage and Cattle on Feed estimates ahead of the May 17th USDA report.

April placements are expected to be 14.7 per cent higher than last year. Feedlot margins remain negative. Cash cattle prices averaged $128 in April compared with March's $127.

April placements appear large as they are compared with the low April 2012 placement (which was 14.8 per cent less than 2011). Cattle placed in April will be marketed from September through November.

Allendale anticipates a marketing total 2.2 per cent higher than April of 2012. This is made after a 4.6 per cent increase due to a calendar adjustment, one more weekday in 2013 vs. 2012, for this month.

Total Cattle on Feed as of May 1 will be 3.5 per cent smaller than last year. This would be larger than the April 1 survey which showed 5.0 per cent fewer cattle. Market ready cattle numbers are tight now and will transition to adequate by late summer.

Allendale projects a 664 million lb. total pork stock level for the end of April. The five year average is 594 million lbs. for the end of April. The Allendale estimate represents an increase of 16 million lbs. from the previous month. The five year average month to month change for April is a 4 million lb. increase.

Beef stocks, at 531 million lbs., are above the five year average of 432. This month's number represents a 17 million lb. increase from the previous month. The five year average change is for a 6 million lb. decrease.


Allendale Cattle On Feed Estimates

**Pork Belly stocks are estimated - in million pounds while Cattle on Feed is estimated as a percentage compared to last year.



Sarah Mikesell, Senior Editor

Philippines Agriculture, Fisheries Grows 3.3 Per Cent in Q1 2013
17 May 2013

PHILIPPINE - The Philippine agriculture industry grew by 3.3 per cent in the first three months of 2013, as all four subsectors — crops, fishery, poultry and livestock — posted respective increases, grossing a total of P352.5 billion at current prices.

Citing estimates of the Department of Agriculture’s Bureau of Agricultural Statistics (BAS), Agriculture Secretary Proceso J. Alcala said the crops subsector, accounting for more than one-half (54.1 per cent ) total agricultural production, increased by 3.6 per cent . It was bannered by palay and corn, which grew by 4.45 per cent and 11.43 per cent , respectively.

For the first quarter of the year, the country’s farmers harvested a total of 4.17 million metric tons (MMT) of palay (unmilled rice) and 2.25 MMT of corn, valued at P66 billion (B) and P27.8 B, respectively, at current prices.

The DA chief said the increased harvests of palay and corn were mainly due to early plantings, adequate supply of irrigation water, higher average yields as a result of increased usage of hybrid and certified rice seeds, hybrid and OPV corn seeds, and additional areas planted to both rice and corn.

“Our efforts are paying off, and we hope to attain our sufficiency targets by year-end,” said Secretary Alcala. “For these achievements, we thank our country’s farmers and fishers for their continuous hard work and perseverance, and strong cooperation of local government units and the private sector,” he added.

The DA targets to produce 20 MMT of palay and 8.4 MMT of corn by end of 2013, making the Philippines sufficient in both staples. Last year’s output totaled 18 MMT of palay and 7.4 MMT of corn.

Just recently, the country started exporting 35 MT of aromatic and organic black rice to Dubai. Another batch of 80 MT of premium and organic, colored rice varieties is being readied for shipment to other countries. The DA in partnership with the private sector also exported 24 metric tons (MT) of corn feed silage for cattle to South Korea. It is part of a total 15,000 MT of corn silage to be shipped to that country this year.

Several major crops also posted positive gains during the first three months of 2013, which included pineapple (increased by 5.8 per cent ), mango (4.5 per cent ), tobacco (4 per cent ), sugarcane (2.5 per cent ), and onions (8.5 per cent ), among others.

The fisheries subsector, which shared 16.3 per cent to total agricultural production, rebounded with a 5.6 per cent growth, as production of aquaculture species like milkfish (bangus) and tilapia has increased.

Larger catch of marine species like roundscad (galunggong) and tuna were also recorded, as result in part of the conservation measures imposed in Zamboanga and Visayan Seas, and lifting of the tuna ban in the Pacific Ocean.

Total value of fishery production amounted to P59.5 B at current prices.

The poultry subsector, accounting for 14.4 per cent to total agricultural production, posted a 2.8 per cent growth, with total value of production at P45.8B at current prices. The subsector was led by chicken, whose output grew by 3.3 per cent , worth P34.6B.

The livestock subsector, which contributed 15.3 per cent to total agricultural output, barely grew, at 0.3 per cent , with total production value of P54.3B at current prices. The hog industry grew by 0.36 per cent , valued at P44.87B at current prices.

Pork Commentary: December Corn Goes Below $5.00
09 July 2013


Jim Long is President &
CEO of Genesus Genetics.


US - Last Friday December corn closed was at $4.91 a bushel - the first time December corn closed below $5.00 for over two years, writes Jim Long.

The market is reacting to a record US corn planting (highest since the 1930’s), favourable weather and moisture. The scenario could lead to a record US corn harvest. How low could corn go? In Brazil last week bid prices for corn per bushel were as low as $2.54 per bushel at Rondonopolis. Other areas were higher in price and some up to the mid $4.00 mark but the idea of $7.00 corn in the coming crop year is getting to the level of delusional thinking in either Brazil or the US.

We have expressed the opinion several times that the hog market and its potential profitability is currently tied to feed prices. We are a corn market not a hog market. Corn price goes down, hog profitability goes up. The supply of hogs is relatively static. For the next year as the US Hogs and Pigs Report showed us last week, we can expect little change in hog supply. To some extent hog prices are profitable within $10.00 per head. Corn and feed though have a window to affect hog margins up to $30 to $40 per head from where it has been.

The current scenario of potentially lower feed prices and static hog supply with what is already historically high hog prices is setting up for fifteen months of quite positive returns for hog producers. We expect many producers will average $20 plus per head profit farrow to finish the next fifteen months.

Hog Market

The US hog market continues its strong run with lean hogs over $1.00 per pound. Weekly hog marketings continue to run very close to last year despite the fact last year had the hottest summer on record. We expect lean hog prices will continue to hang around $1.00 until mid – August.

The canary in the mine for the markets is currently early wean and feeder pig prices. A year ago early weans were below $10 and feeder pigs $18. This year early weans are over $30 and feeder pigs are over $50. We are told repeatedly by feeder pig brokers demand is outstripping supply - this despite July usually the worst time of year to find buyers. If this keeps up we expect early weans could be $50 in October and feeder pigs $70. December corn goes lower in price? We are low with our price projection.

 


Observations

No doubt the United States has the most arable acres and the greatest capacity to produce food with 417,081 million acres. China has a large amount of arable acres and has proven its ability to produce food for a massive population. All of these and many other dynamics are affecting us every day. We are in a truly global economy. Indeed the recent strength in the US dollar due to many global and domestic factors is keeping current hog and grain prices for US producers. For Canadian producers the opposite stronger US dollar helps their margins. The point is markets react to Global Supply and demand. We don’t live on an island!


Author: Jim Long, President & CEO, Genesus Genetics

Weather Impacts Food Prices in China
26 July 2013

CHINA - The humid weather last week has affected the country's agri-food prices.

According to a survey of 36 medium and large sized cities conducted by the Ministry of Commerce (MOFCOM) there was a small rise in prices.

The average wholesale prices of meat saw ups and downs, among which, prices of pork and mutton were up by 0.8 per cent and 0.1 per cent respectively compared to the previous week and the price of beef was steady.

The retail price of chicken and eggs fluctuated by a small margin. The price of chicken was up by 0.3 per cent and price of egg fell by 0.3 per cent compared to the previous week.

The average wholesale prices of eight kinds of aquatic products were down by 0.1 per cent as compared with that of the previous week.

The top drop was seen in price of large yellow croaker and Small hairtail, down by 2.8 per cent and 0.8 per cent respectively.

Retail prices of cooking oil and food grain were steady. Both peanut oil and rapeseed oil were up by 0.1 per cent compared to previous week, soybean oil was down by 0.1 per cent and the price of small package of rice and small package of flour remained the same.

The average wholesale prices of 18 vegetables went u

AHDB Pig Market Weekly

Reports » AHDB Pig Market Weekly » AHDB Pig Market Weekly - 1 August 2013

01 August 2013
AHDB Pig Market Weekly - 1 August 2013AHDB Pig Market Weekly - 1 August 2013
Latest AHDB/BPEX forecasts for UK pig meat supplies indicate that the fall in pig slaughterings this year will be smaller than previously thought.

AHDB

Little change forecast for UK slaughterings and production

For the year as a whole, clean pig throughputs are expected to be just over 10 million head, still lower than last year but only marginally. Sow slaughterings are likely to be back more significantly, particularly in the second half of the year when they were inflated last year as a result of high feed prices. However, these declines will be offset by higher clean pig carcase weights, so pig meat production is set to be fractionally higher than last year at 828,000 tonnes. The upward revision of the forecasts is largely the result of better-than-expected improvements in sow productivity. With some recovery in the herd forecast, slaughterings and production should resume their upward trend in 2014.



With tight supplies elsewhere in the EU and increased retailer preference for UK pig meat, imports so far this year have been lower than a year earlier. This trend is expected to continue for the remainder of the year, with volumes stabilising next year. UK exports have been strong so far in 2013, buoyed by demand from China but growth may slow in the remainder of the year with supplies tighter. Nevertheless, shipments for the year as a whole should be up significantly, a trend expected to continue into 2014. The net result is likely to be lower supplies for domestic consumption, a trend apparent in figures for retail sales for the year to date.

More details on the outlook for UK pig meat supplies can be found in the latest edition of Pig Market Trends, which can be downloaded by clicking here.

Production costs fall further in July

Latest AHDB/BPEX provisional estimates show that the cost of pig production fell further in July. This was largely due to the easing of spot feed prices as prospects for this year’s harvest still look positive. Average costs in July were estimated to be just under 159p per kg. This is the lowest level since June 2012 and around five pence lower than the month before. Costs have fallen by over 14p per kg since January and are now below the level a year earlier for the first time since feed prices began rising last summer.



With the average pig price standing at over 168p per kg in July, producer margins are back in the black, having been in negative territory since late 2010. However, while this reflects the trading position in the latest month, it is worth remembering that pigs being sold during the month will have been fed through a period when costs were typically much higher. In addition, some producers will have bought feed ahead earlier in the year and they will not yet have benefitted from the lower spot prices on which the estimates are based.

UK pig prices

For the week ended 27 July, the EU-spec DAPP came down to 168.25p per kg. Finished pig prices have started to experience some downward pressure, with a week-on-week fall of 0.56p, as recent price rises started to hit consumer demand. This meant that the difference between the latest price and the same period last year narrowed to just under 18p. The recent turn in the weather will have dampened demand for the barbecue season but it could help sales of some other products. Estimated slaughterings were slightly up on a year earlier, at 163,400 head. Carcase weights increased slightly during the week, to 78.82kg but the hot weather appears to be delaying the seasonal increase in weights which would normally be seen at this time of year. Nevertheless, this week’s average was more than a kilo up on a year earlier.



For the eighth consecutive week, cull sow prices rose, to 112.61p per kg for the week ended 20 July. Fuelled by a more robust market across the continent, this was almost 3p up on the week. The recent increases have taken the sow market above year earlier levels for the first time since November last year, with the annual change for the week up 4p.

With the finished pig market easing slightly, the weaner price was again little changed. The latest quote, for the week ending 3 August, fell to £53.54 per head. This was four pence lower than a week earlier but the year-on-year increase remains large, at nearly £14 per head.

Pork marinades up as the summer arrives

In the 12 weeks to 7 July, consumer spending on pork increased 1% compared with the same period last year, according to the latest figures from Kantar Worldpanel. This growth continues to be driven by price rises (up 4%), as the amount purchased fell 3% on the year. Pork marinades were the main bright spot, making up 14% of all pork sales by volume. The largest gains were for ribs, likely driven by the barbecue season. Most other cuts recorded a decline in volume purchases compared to last year.



Over the same period, spending on bacon was 1% below last year, as the amount purchased declined 5%. Fewer households purchased and those that did shopped less frequently. Expenditure on sausages was up by 10%, despite volume purchases falling 4%, although premium sausages again performed well. Sliced cooked ham has shown good growth, with expenditure up 4% and the amount purchased 5% ahead of last year, due to shoppers buying more often and buying more per trip.

In the most recent 4-week period, volume sales of pork declined 6%, resulting in a spending decrease of 2% compared to last year. Marinades were again the only cut to show volume growth. Bacon sales fell further behind last year as the amount purchased declined 10%. Spending on sausages again increased despite volume purchases declining but ham continued to perform better.

EU pig prices on the up

With demand having been subdued for much of the year, EU pig prices showed little sign of life. However, that began to change in June as improved weather conditions stimulated demand in northern Europe, as did the approaching holiday season in the south. At the same time, export markets were improving, notably Russia where EU pork replaced supplies from the Americas. Into July, tighter supplies meant that prices increased rapidly with demand remaining strong. By week ended 21 July, the EU average reference price had risen to €182.09 per 100kg. This was its highest level since November, up €18 since the low point in May and nearly €14 more than a year earlier. With prices starting to approach similar levels to last autumn, the impact on consumer demand remains to be seen.



Prices have increased in recent weeks across all major producing Member States. In Germany, the reference price had increased by €16 since mid-May, with similar rises in neighbouring Belgium, the Netherlands and Poland. There were even larger increases in Southern Europe, with the Italian reference price up by over €30 in six weeks and the Spanish quote moving above €200 per 100kg for the first time since 2001. Growth was somewhat slower in Denmark, up by only €8 since May and less than €3 in the last four weeks. Although the UK reference price remained firm through this period, upward movement was more limited so the UK’s premium over the EU average price fell from over €24 in mid-May to less than €10 in the latest week.

Feed market update

The Nov-13 UK feed wheat futures price closed on Tuesday two pounds lower over the week at £162.50/t. However, this represents an increase on Monday’s close as the UK price followed Chicago wheat prices higher on Tuesday. In a longer term context, this is a decline of more than £35/t since the Nov-13 price peaked last November. Global wheat prices have seen some support recently on strong export demand from Japan and Egypt plus concerns for the US wheat quality. The US weather continues to get the main attention as every day gets closer to the realisation of the estimated bumper crops. Some more weather risk is expected to be taken out of the market as more rain is forecast for the next two weeks.

The Hi-pro any origin soyameal (ex-store East coast) price as at Friday 26 July was £432/t for July delivery, up £5 on the week. The Chicago soyameal Dec-13 futures price closed at $401.10/t on Tuesday, down 4% from the week before. Rape meal prices have continued to decline due to improving global rapeseed crop conditions on top of the favourable US soyabean crop conditions. According to analysts Oil World, physical supplies of soyameal were still rather tight in the EU in July, keeping nearby delivery prices firm and above average. However, arrivals are expected to pick up in the coming weeks.

To read more about the latest developments in the feed market click here.

Most pig farms taking action to prevent disease

New figures from Defra show that 90% of farms with pigs are undertaking at least one practice to prevent animal disease. The most common of these, employed by 80% of farms, were measures to prevent disease being brought onto farm by visitors. This was more prevalent among pig farmers than those in other livestock sectors and was particularly common in the main pig producing regions of Yorkshire and East Anglia. Farms with pigs were also more likely than other livestock farms to be taking other measures, such as using strict stock replacement policies and separating new livestock from existing animals.

However, only just over half of pig farms had implemented a farm health plan in consultation with their vet, a lower proportion than for dairy or poultry farms. Similarly, at 40%, fewer farms had provided training in disease management than in the dairy or poultry meat sectors. Most livestock farms carrying out preventative measures were doing so for animal welfare or financial reasons. Overall, only a quarter cited the market or customer as a reason for doing so but for pig farms this factor was mentioned by well over half of farms.

The full report can be downloaded by clicking here.

June Pig Market Trends out now

The July edition of Pig Market Trends (PMT) was published on Tuesday. As well as the usual coverage of producer prices, slaughterings and production, trade, retail sales and prices, costs of production and other industry news, this month’s edition includes the latest outlook for UK pig supplies (see above).

Key messages this month include:
•GB pig prices, already at record levels, continue to increase in June on strong demand for UK pig meat
•Little annual change in UK slaughterings in June but carcase weights remain high
•UK pork exports in May up on the year again on the back of strong demand from Germany
•Pork imports in May similar to year earlier but cured and processed volumes lower
•Trust in food retailers recovering from horsemeat revelations but shoppers more aware of quality standards
•Cereals prices decline further as global weather remains favourable but soya expensive in short-term

Feed Production, Prices Rise
09 August 2013

UK - Retail production of animal feed was 6.7 per cent higher in June 2013, while average prices for the quarter are well above the levels of the previous year.

Statistics on animal feed production in Great Britain for the April to June quarter have been published by Defra.

For the latest month of June 2013, total GB retail production of animal feed was up 6.7 per cent compared with June 2012 at 853,300 tonnes of compound feed, blends and concentrates. The moving 12-month figure stands at 10.756 million tonnes.

Total integrated feed production was 5.1 per cent higher in June 2013 than the same month last year.

Total raw material usage in the retail production of animal feed was up 5.3 per cent compared with June 2012.

Feed price increases appear to be levelling off somewhat this year but they are well above those of a year ago for all species. Average prices per tonne for the quarter April to June 2013 (with the corresponding figure from 2012 and percentage change in brackets are:
•Cattle and calf feed - £253 (£223; +13.5 per cent)
•Pig feed - £288 (£259; +11.2 per cent)
•Poultry feed - £311 (£268; +16.0 per cent)
•Sheep feed - £257 (£222; +15.8 per cent)

Food Prices Stay Stable in China
16 August 2013

CHINA - Meat prices remained stable indicating just a slight increase, wherein the wholesale pork prices rose by one per cent as compared to the previous week.

Beef was up by 0.3 per cent, and lamb remained unchanged.

The retail prices of chicken and eggs kept rising, up by 0.5 per cent and 0.6 per cent respectively compared to the previous week.

The average wholesale prices of eight kinds of aquatic products were up by 0.5 per cent compared to the previous week. The top price rises were big yellow croaker, small cutlass fish and crucian carp, up by 2.9 per cent, two per cent and 1.6 per cent respectively.

The wholesale prices of 18 vegetables dropped by 2.4 per cent compared to the previous week having risen for three consecutive weeks previously.

The main falls were bitter gourd, cucumber and tomatoes as market supply is on the increase, and prices fell 10.8 per cent, 7.6 per cent and 6.9 per cent respectively.

The retail prices of edible oil and food-grains remained basically stable with a slight decline.

Soybean oil, small packages of flour and rapeseed oil fell by 0.3 per cent, 0.2 per cent and 0.1 per cent respectively compared to the previous week, and small package of rice and peanut oil remained unchanged.

USDA GAIN: Livestock and Products

Reports » USDA GAIN: Livestock and Products » USDA GAIN: Mexico Livestock and Products Annual 2013

23 August 2013
USDA GAIN: Mexico Livestock and Products Annual 2013USDA GAIN: Mexico Livestock and Products Annual 2013
Cattle inventories continue falling but new programs and a focus on improving genetics and management practices may help the industry rebound. Red meat prices remain the driving factor affecting consumption which has led to reduced beef and an upswing in pork demand. Mexico’s industry and the government are looking to expand their own exports while the United States was able to export over $1 billion in pork and $725 million in beef to Mexico in 2012 with growth expected in 2013 and 2014.

USDA GAIN: Livestock and Products

Commodities:

Animal Numbers, Swine
Meat, Swine

Production:

The Post 2014 Mexican pork production forecast is 1.29 MMT CWE and the revised 2013 production estimate is 1.265 MMT CWE. This is due to the continued incorporation of new breeding lines, better farm management techniques, and increased slaughter weights that have allowed production of more meat from fewer hogs. In addition, industry members are expanding production with the potential opening of the Chinese market. Mexican access to China has been discussed at the head of state level and received significant industry and media attention in the first half of 2013. Post’s 2012 production estimate has been revised upward based on the latest preliminary official data from SAGARPA to 1.239 MMT CWE. The data shows that the state of Jalisco was responsible for 19.2 percent of pork production, followed by Sonora (18.6 percent), Puebla (9.9 percent), Guanajuato (8.7 percent), and Veracruz (8.6 percent).

Genetics Continue Improving and Additional Feeding Options are Developing

Genetic improvements are allowing the pork sector to nudge the live pig crop higher in 2014. These hogs also have better genetics and are able to gain desired market weights faster with improved rates of gain. Recently, the government of Mexico (GOM) restricted the import of swine for breeding purposes from the United States as a response to the porcine epidemic diarrhea (PED) outbreak (see GAIN Report MX3051). However, live breeding animals from other countries (e.g., Canada) and genetic materials can still be imported into Mexico which should help the industry to make continued production improvements.

Industry sources report that swine continue to be slaughtered at around 115 kg live weight with a carcass weight of around 82 kg. These members report that swine are held in feed lot operations for around 50 days.

Pork feed is based on yellow corn as well as sorghum and represents approximately 64 percent of the production cost. Industry sources report that although these feed grains are a staple, northern Mexico producers are feeding hogs with Durum wheat, which is seasonally over supplied, as a special request from interested customers. Spokespersons for the Mexican pork sector report that pork producers in the states of Sonora and Sinaloa have been requested to supply specific Asian markets with pork meat from animals exclusively fed on wheat. Reportedly, the taste, color and tenderness of resulting pork cuts are an added-value asset which is appreciated by high-end consumers.

Consumption:

The Post 2014 total pork consumption forecast is 1.96 MMT CWE as purchasing power gains as well as pork’s attractiveness in comparison with beef and poultry will continue contributing towards increased demand. This could be tempered, however, if the Chinese market opens and pushes prices higher while other suppliers are not able to immediately put product into the domestic market. Post’s 2013 estimate of pork consumption remains unchanged while the 2012 estimate was revised upward based on official data.

Pork Consumption Is On the Upswing

Middle income consumers (a smaller portion of the population) continue shifting consumption habits from poultry and beef back to pork due to high beef prices and more recently due to concerns over the widespread highly pathogenic avian influenza (HPAI) outbreak and increased poultry product prices. Reportedly, as well, promotion and marketing campaigns launched by the industry have been successful. It appears that pork is slowly gaining acceptance among consumer groups and shoppers as part of a healthy diet.

Prices Shape Buying and Production Decisions, but Culture Important, Too

Industry sources reported unusual consumption patterns and prices for early 2013. Usually, pork consumption and prices drop during the 40 days prior to Holy Week (i.e. Easter) however, pork prices moved lower than traditionally witnessed. Some sources blame the high volume of imported pork for keeping prices depressed while other signs indicate that some producers slaughtered larger numbers of swine in the latter part of 2012 and early part of 2013.



Trade:

The Post 2014 import forecast is 790,000 MT CWE based on sustained strong demand and pork’s competitive prices. The trade forecast is based on higher demand from Mexican consumers who have greater purchasing power and a consumption preference for varied sources of animal protein. The Post 2013 pork import is also revised upwards slightly to 775,000 MT CWE as imports from the United States, Canada, Chile, and Spain are all growing. The majority of Mexico’s pork imports remain hams and picnic as well as mechanically deboned meat (MDM) for the preparation of sausages, deli hams, and other cold cuts. Post’s 2012 pork import figures were kept unchanged from official data.

Industry sources have indicated that the authorization of an export quota of 300,000 MT to China could lead to an increase of frozen pork meat imports as it would be used as export replacement in Mexico or, if allowed, possibly used in the preparation of exports for China.

Historically, trade data has indicated the United States is the main supplier to Mexico. Thus, no changes in this pattern are likely to occur in the short to medium term.

Mexican Pork Meat Exports: The Key to Open China’s Door for Other Products?

The Post pork export forecast for 2014 is 120,000 MT CWE as the country looks to open export markets in other Asian markets and has been able to steadily grow its exports in these markets. The Post forecast for 2013 is kept unchanged at 110,000 MT CWE as overall demand from Asian countries remains stable (although South Korea is not buying pork from Mexico right now, it appears that Japan’s purchases have stepped up). The sector has thus been able to continue supplying these markets with added-value products, with significant manual labor, at attractive prices. Post’s 2012 export estimate is unchanged and based on official data.

Jalisco is the main pork producing state but Sonora is the number one exporter. Industry sources report that out of every 10 MT exported, 9 MT comes from Sonora. Japan remains Mexico’s number one export market by volume and value. Pork meat exports are mostly loin to Japan, loin to the United States, and have traditionally been bone-in pork to South Korea.

Policy:

The United States’ recognition of Mexican States as free of classical swine fever (CSF) has been one of the key factors to opening foreign markets for Mexican pork and sources suggest that expanded Mexican access for raw pork to the United States will serve to increase access to other countries. As such, one of Mexico’s most important trade policy goals with the United States is expanded pork access.

NOTE: Mexico is a large market for pork offals and other non-skeletal muscle items. The trade volumes reflected below are based on CWE calculations for harmonized tariff system codes 020311, 020312, 020319, 020321, 020322, 020329, 021011, 021012, 021019, 160241,160242, and 160249.

August 2013

Global Organic Food Market Growing
28 August 2013

ANALYSIS - The global market for organic food grew by more than 25 per cent since the start of the global economic crisis between 2008 and 2011.

According to the Soil Association’s Organic Market Report 2013, worldwide sales of organic food and drink reached $63 billion – more than €45 billion – by the end of 2011.

The latest figures from the Research Institute of Organic Agriculture (FiBL) and the International Federation of Organic Agriculture Movements (IFOAM) organic farming is practised in 162 countries.

In 2011 37.2 million hectares of farmland were managed organically and organic farming had a 0.86 per cent share of agricultural land surveyed.

The report says that it is estimated that there are another 32.5 million hectares of organic wild areas and non-agricultural land bringing the total organic farm land to 69.7 million hectares.

The countries with the largest organic areas of form land are Argentina, the US and Australia, which the Falkland Islands with 35.9 per cent if its land, Liechtenstein with 27.3 per cent if its land and Austria with 19.7 per cent of its land have the highest proportions of organic farm land.

Oceania has 12.2 million hectares of organic farmland, Europe 10.6 million hectares and Latin America 8.4 million hectares, while Asia had 2.8 million hectares.

The greatest demand for organic food is in the US and Europe – accounting for more than 90 per cent of sales.

Sales in the US during 2011, the latest year recorded in the report, were worth €21 billion. In Europe, Germany had sales worth €6.6 billion, while France had sales of €3.8 billion.

While Europe as a whole is experiencing a rise in organic food sales, the UK has seen its market slide.

The UK saw a 1.5 per cent decrease in sales overall in 2011 down to £1.64 billion and the number of businesses fell by 4.9 per cent to 6,929. The amount of farmland devoted to organic farming also fell – by 8.7 per cent to 656,000 hectares.

However, the report shows that despite these falls, there are areas of significant growth for organic Products including parts of the dairy sector, large specialist retailers, home delivery, non-food products and catering.

In Europe, the highest average annual consumption was in Switzerland, where it reached €177 per person. In Denmark it was €162 and Luxembourg €134.

The highest market shares of the food and drink market for organic products were in Denmark, Switzerland and Austria.

Europe is the largest consumer of organic foods and overall organic farming accounts for 2.2 per cent of the total European farm land and 5.4 of the farm land within the EU.

Overall in Europe organic sales grew by nine per cent in 2011 to reach €21.5 billion.

The Soil Association report shows that the US organic market, while being the biggest, is dominated by large companies throughout the supply chain.

With an organic land area of 2.7 million hectares, the market is worth €22.9 billion and sales of organic produce grew by 9.4 per cent in 2011 to €21 billion. Organic products now account for four per cent of food and drink sales.

The US organic market received a boost in the middle of last year, when EU and US organic standards were recognised as equivalent, removing the need for separate certification.

The report says that Latin America with 8.4 million hectares of organic farm land is an important producer and exporter, with growing domestic consumer markets and with Brazil leading the way.

The report shows that the Asian market for organic produce is growing steadily as the awareness of organic methods bolsters demand.

Most sales are in the affluent countries such as Japan, South Korea, Taiwan, Hong Kong, Malaysia and Singapore.

Most of the organic produce, however, is imported from Australasia, Europe and the US.

The market in Australia, New Zealand and the Pacific Islands is relatively small, but Australia and New Zealand are both important producers of organic product.

The report says that Africa is a continent of mass small-scale organic farming with more than half a million producers on 1.1 million hectares of land. Almost all the organic produce goes for export and largely to the EU.

The report concludes: “Against an uncertain background in the UK there is encouraging news in the continuing growth of organic food sales elsewhere in Europe and in North America.

“This growth shows no sign of abating, and indicates that the long-term prospects for the organic market in the UK should also be good.

“It is hard to anticipate when the UK market will return to growth, but less difficult to predict that it will surely do so.

“The new wave of interest in ethical shopping among young consumers has the potential to lead the organic revival.”

GLOBAL - The Agri Commodity Market Research team at Rabobank is bearish on most agri-commodity prices, predicting further falls in grain and oilseed prices to the end of 2014.

In the latest Poultry Quarterly Review for the third quarter of 2013, Rabobank's Agri Commodity Market Research team reports that a further downward slide is expected from current levels as the new crop supply becomes more certain.




Rabobank quarterly average price forecast (3rd quarter 2013 - 2nd quarter 2014)
Source: Bloomberg, Rabobank, July 2013

For wheat, prices are forecast to remain bullish as harvests are forecast to be higher than last year in the Black Sea region, the EU and Canada.

With favourable weather in the US, the maize (corn) market globally is described as 'bearish' as fears of a crop failure there diminish.

Rabobank is forecasting bullish conditions for soybeans although it warns of possible volatility ahead in case of adverse weather conditions.

The Review adds that improving market conditions in the Chinese animal protein market are pushing up demand in China, which is supporting global markets.