European Pig Meat Industry Facing Its Challenges
04 April 2013
 

EU - The European pig meat industry is facing its challenges with issues such as regulations on sow pens impacting production, according to Frederique Clusel, group director of Swine Business for Zoetis for EU Africa and Middle East.

Speaking at the recent launch of the new company, which emerged from the divestment of the animal health sector from Pfizer, Mme Clusel said that with 7 billion people now demanding protein and the EU having 16 per cent of global meat consumption, the pig meat industry in the region was well placed to meet the growing demand.
 
At present, pig meat consumption in the EU is 41.6 kg per person a year and in meeting the challenges presented to the sector, pig producers are using fewer antibiotics and those that are used are being used more and more responsibly.
 
She said there has been a 47 per cent drop in the use of injectable anti-infectives since 2009 and a 23 per cent drop in the use of oral anti-infectives in the same period. At the same time there has been a 20 per cent increase in the use of vaccinations to prevent disease.
 
"Through prevention there has been an increase in the pig health level and with healthy pigs you get healthy meat," said Mme Clusel.
 
"We will still need anti-infectives, because there will still be disease on the farm, but we need to use them in the right way.
 
To hear more of Frederique Clusel's thoughts on the developing pig meat industry and the challenges it faces click through to her video interview here.

Danish Pig Research Centre Annual Report 2012: Economy
Friday, April 12, 2013


Information on production and structural development in the Danish pig industry, trends in the production, developments in productivity, competition for Danish weaners and seasonal price developments from the Danish Pig Research Centre.
 



Production & Structural Development

Structural development

In 2011, Denmark had a total of 4,500 registered pig farms. Of these, 1,800 were integrated farms with both sows and finishers. Herd size averaged 255 sows.

There were 600 specialised sow farms with an average of 950 sows, and 2,100 specialised finisher farms with an average annual production of 6,800 finishers.

Production scope

Overall production (slaughter + exports) in 2012 is expected to total 29.007 million, which is 1.6 per cent lower than 2011 when production totalled 29.465 million. In the first half of 2013, production is expected to be close the level of 2012 of 28.800 million.

This shows that the Danish pig production industry seems to be managing successfully the conversion to group-housing of gestating sows without encountering dramatic drops in production. A survey made in summer 2012 showed that 80 per cent of all gestating sows were housed in groups, and it was expected that a very large part of the farms that had yet not converted would do so before 2013.

Slaughterings in 2012 are expected to be around seven per cent below the level of 20ll, which is a reduction from 20.9 million slaughtered pigs in 2011 to 19.4 million. The first half of 2013 is currently expected to be close to the level of the first half of 2012 but the trend will depend on the development in the export of live pigs.

The export of weaners has increased over the past years. In 2012, exports increased to 9.157 million weaners, which compares with 8.039 million in 2011, representing an increase of 14 per cent.

 


Table 1. Development in Danish pig production, slaughtering and export of pigs
 


Year

Total slaughterings

Export pigs/sows

Export weaners

Total
 


2006

21,370,409

789,812

3,578,898

25,739,109
 


2007

21,398,152

1,103,266

3,850,844

26,352,262
 


2008*

21,064,216

1,059,997

5,280,258

27,404,471
 


2009

19,288,591

1,250,173

7,043,720

27,582,484
 


2010

20,243,996

896,191

7,515,047

28,655,234
 


2011

20,925,925

500,395

8,039,111

29,465,431
 


2012**

19,381,365

468,830

9,157,133

29,007,328
 


2013**

?

?

?

28,800,000
 


Based on figures reported to the Pig Levy Fund and on DAFC projections
* 53 weeks
** Projections

 
Trends in Production Economy

Financial results

Table 2 outlines the development in production economy for full-time pig farms over the last decade.

The top part of the table shows the results of full-time pig farms and the bottom part shows financial key figures by production category.

The number of full-time pig farms has dropped by approximately 2,850 (48 per cent} in the last 10 years, while the number of sows per year per farm has increased from 193 to 273 (41 per cent}.

The number of finishers produced per pig farm has increased from 2,777 to 7,073 (155 per cent). Land has increased from 97 to 172 hectares (77 per cent}.

Gross margin including land has increased from about DKK1.5 million to around DKK3.5 million from 2002 to 2012. In 2011, gross margin per year increased to DKK3.5 million as a consequence of rising grain prices and pig prices.

 


Table 2. 10-year development in Danish pig production

 


 

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011
 


No. of accounts

2,353

2,053

1,935

1,852

1,776

1,694

1,508

1,660

1,667

1,611
 


Farms

5,926

5,655

4,870

4,401

4,176

4,210

3,447

3,154

3,529

3,075
 


Sows/year

193

200

199

223

255

241

267

300

311

273
 


Finishers produced

2,777

2,969

3,415

3,397

3,677

4,003

4,713

4,607

5,180

7,073
 


Area (ha)

97

104

112

115

125

136

148

148

150

172
 


Total economy
 
Per farm DKK '000
 


Gross profit

2,327

3,207

3,534

3,550

4,342

4,156

5,416

5,634

6,760

8,489
 


Gross margin

1,608

1,471

1,804

1,766

2,321

1,711

2,053

2,211

3,122

3,529
 


Key financial figures
 
DKK per production unit
 


GM/sow/yr

3,852

2,853

3,850

4,033

4,811

1,893

2,828

3,398

4,077

4,153
 


Pigs/sow/yr

23.7

23.6

22.6

23.7

24.9

26.1

26.3

26.2

26.6

28.3
 


Price/pig

352

309

338

351

368

327

333

354

363

358
 


GM/weaner

163

121

170

170

193

73

108

127

154

147
 


Price/FU (sow + weaner)

1.40

1.38

1.38

1.35

1.31

1.63

1.95

 

1.75*

2.04*
 


GM/ finisher

111

79

111

138

149

97

86

83

135

132
 


FU/ kg gain

2.95

2.90

2.91

2.82

2.96

2.96

2.88

2.86

2.87*

2.87*
 


Price/ kg incl. bonus

9.62

8.34

9.25

9.38

9.83

9.15

9.83

9.41

9.93

10.79
 


Price per FU finisher feed

1.15

1.10

1.13

1.19

1.08

1.30

1.67

1.34

1.36

1.71
 


*Feed units (FU) 2010 and 2011 are based on production reports and account figures
 

Economy per production unit

From 2002 to 2012, gross margin per sow and year averaged DKK3,575, while gross margin of finisher farms averaged DKK112 per finisher produced.

In 2011, gross margin on breeding farms increased to DKK4,153 per sow and year, while for finishers, it remained largely unchanged at DKK132 per finished pig produced.

Terms of trade

Terms of trade dropped from 7.29 in 2010 to 6.16 in 2011, averaging 7.15 over the last decade.

The increases in grain and feed prices seen during harvest 2010 were reflected in 2011 when feed prices remained high all year. However, pork prices also increased. Terms of trade tended to increase in the first half of 2012 and soybean prices soared in summer 2012.

 


Figure 1. Development in terms of trade, 2002-2012 June
 
Development in Productivity

Significant progress on sow farms in 2011

Data supplied by the local pig advisory centres includes 664 sow farms with a total of 425,000 sows per year, 574 weaner farms with a total production of 9.4 million weaners; and 746 finisher farms with a total production of 4.9 million finishers.

Sow farms weaned on average 28.8 pigs per sow and year, which is an increase of 0.7 pig per year compared with the previous year. Herd size averaged 640 sows.

Weaner farms produced 15,372 pigs per year on average. Data shows an FCR of 1.95 FU per kg gain, a daily gain of 443g and an average mortality of 2.9 per cent. These figures are almost identical to 2010 figures.

Finisher farms produced 6,537 pigs per year. Daily gain averaged 898g with an average FCR of 2.87 FU per kg gain. Mortality averaged 3.5 per cent and culled pigs averaged 0.2 per cent.

Top 25 per cent

The top 25 per cent of all sow farmers are four to five years ahead of the average farms. The top 25 per cent of farmers in weaner and finisher production have a performance level that is around 10 years ahead of the average farms. This demonstrates that with a dedicated effort in weaner and finisher production, it is possible to improve productivity significantly on the average farm.

Will progress continue?

Analyses of progress in annual productivity often concern mainly progress among the top 25 per cent farmers, which averaged 31.5 in 2011. This documents that many farms have an unexploited potential, which is in particular found in areas such as live-born per litter and non-productive days. Consequently, it may be possible to improve productivity levels improvements in management.

Genetic progress in LP5 (live pigs five days after farrowing) is expected to continue to improve the potential for more weaned pigs per litter partly through an increase in live-born and partly through reduced mortality. However, the economic value of a marginal pig at weaning drops if the effort of producing the pigs increases.

When litter size increases, more nursing sows are generally required, which in turn requires more work and more farrowing pens. Consequently, the value of one more live-born piglet will drop long-term.

There is no doubt that the increase in weaned pigs per sow and year will continue for years but the annual increase may slow gradually. If feed prices remain high, efficiency rather than productivity will be the central element. High feed prices will also direct attention towards feed conversion and mortality. A high feed price will result in a higher finisher price and thereby increased losses on dead pigs. Danish pig producers have at all times been highly adaptable as times have changed.

 


Figure 2. Trend in live-born and weaned pigs per sow and year
 
Competition for the Danish Weaner

Denmark-Germany

Weaner exports increase annually with the majority being exported to Germany. The long-term and short-term competitiveness of Danish finisher producers was compared with German finisher producers using model calculations.

Results

Danish finisher production is competitive in the long term. Short-term, however, analysis showed that German finisher producers are more competitive, particularly when the supply of weaners is low and weaner prices increase. Exports will consequently increase.

Demand for weaners
 
Short-term, demand depends on existing housing capacity and the expected positive contribution to earnings when weaners are moved to the house. Contribution to earnings is defined as financial result before interest and depreciation on housing facility. Once we know the pig price, feed prices and other financial costs, before interest and depreciation, related to producing a finisher, it is possible to calculate the maximum that producers are willing to pay for a weaner.

Weaner market

The pool price of a Danish weaner is also affected by German demand for Danish weaners.

When demand exceeds supply, the market value of a weaner is controlled by the accumulated maximum that all finisher producers in a given geographical area are willing to pay. This knowledge is used in the following scenarios.

Scenarios

The expected 'normal' level of demand for weaners in 2013 is expected to correspond to 20 million Danish and 55 million German finishers. The implications for Danish pig producers of a three or five per cent drop in the supply of weaners in 2013 are calculated in the following price scenarios.

 


Table 3. Price prerequisites
 


Price scenario

0

1

2
 


Feed price
DKK/FUgp

1.70

2.15

2.15
 


Settlement
DKK/kg

11.80

11.80

13.00
 

Scenario results

Results are shown in Figure 3. Generally:
 •High feed prices is an advantage for Denmark
•High settlement prices are an advantage for Germany

A five per cent drop in the supply of weaners will overall result in 3.75 million fewer slaughterings in Denmark and Germany put together. This will drop to 2.4 millions if the supply of weaners only drops by three per cent.

Despite the fact that the Danish finisher industry is smaller than that in Germany, price scenario 0 combined with a five per cent reduction in weaner production in Denmark and Germany in 2013 will result in 2.4 million fewer slaughterings in Denmark, i.e. a greater reduction in slaughterings in Denmark than in Germany. With price scenario l, the number of slaughterings drop in Denmark. while with scenario 2, export of weaners to Germany will increase. This would occur despite the fact that increases in feed prices are not quite covered by increasing settlement in scenario 2.

The overall German advantage in the short term is attributed to the German tax regulations for agriculture, 'Pauschal', which favour German finisher producers, enabling them in the short term, to pay more for a weaner than a Danish producer.

 


Figure 3. Scenarios for weaner exports from Denmark to Germany
 
Future competitiveness

Long term, competitiveness is the ratio between production costs and settlement in a given area. Analyses show that production costs are almost identical in Danish and German finisher production. Provided settlement is identical and the supply of weaners has been brought to a 'normal' level, Danish finisher production will still be able to match the German production.

Seasonal Variations in Prices

Weaner prices are peaking

German finisher producers include the normal seasonal variations in finisher prices. However, this does not allow the German finisher producers to predict the price of a finisher. Only the regular seasonal variations are included in the expected finisher price.

The development in weaner prices can thereby not be used for predicting the future price of finishers.

Seasonal variations in pig prices in Germany averaged DKK1.75 per kg from top to bottom compared with DKK1.17 per kg in Denmark. This means that prices may be slightly higher in Germany in peak season than in Denmark without the annual price necessarily being higher in Germany (Figure 4).

 


Figure 4. Seasonal variations in settlement
 
Pig prices 2004-2012

Over the past years, prices have increased from a low level of approximately DKK9 to DKK10 per kg to above DKKll per kg in 2012. Prices have fluctuated in brief cycles and each time, they peaked slightly higher (Figure 5).

 


Figure 5. Price per kg meat
 
Weaner market

Pool prices are higher usually higher than the calculated price in the first half of the year, while the calculated price historically is higher from the beginning of summer until the end of autumn. As an average of several years, the difference between the calculated price and the pool price is insignificant (Figure 6).

 


Figure 6. Weaner market and German prices
 
Economy in German pig production

When finisher producers buy weaners on the basis of their expectations to the pig price by the time they are going to sell the pig as a finisher, gross margin (GM) per pig becomes more stable than for finisher producers buying weaners at the calculated price. Seen over an entire year, weaner prices are fairly similar, and differences in overall GM for a year will therefore not differ significantly.

 


Figure 7. Economy in German finisher production
 
April 2013

Spain: Hog Markets
02 May 2013
 

SPAIN - If we had to summarize the situation of the market in Spain or in Europe it would be: Scanty offer and scanty demand, writes Javier Santamartina - Spain, Italy & Portugal Genesus Representative.

If we analyze the offer, they are fewer pigs than in other years and prices are lower every week and lower than other years in the same week. This is the reason that the price is higher than in the last 5 years in this same week. Adaptation to animal welfare regulations and high feed prices in explains almost everything.
 
The price has remained stable over the last two months March and April and it will probably continue with this trend. It is expected that in summer there will be an increase in price, when pigs grow the slowest with the heat. There is an acceptable stock of frozen pork that could explain why there is no increase in price.
 
More confusing is the demand which has been lower. Different factors can explain why Spain in particular and the EU are in general is more dependent on exports.
 1.Internal demand is very weak in Spain. More than 6 million unemployed people have reduced demand of pork both fresh and processed. Also this reduction is more notable in higher priced cuts. In the European Union this trend is also the same with a reduction in price of ham in France, Italy and also Germany with increased consumption of cheaper cuts. In Northern Europe it has been raining and as a consequence the barbeque season has been delayed, so European consumers are not spending much on pork at this time.
 2.Export to other countries like China or Viet Nam has decreased their quotas and with less margins than previous years.
 3.Russia decided to stop the pork imports from Spain and from some German operators. The reason given by the Russian authorities is that there are some irregularities detected in the inspections by Russian technical personnel during the last month in Spain. It also affects some operators from Germany. This ban concerns Russia, Belorussia and Kazakhstan. Currently this has not caused too many problems to the meat that has been stored, the main concern is the sale of the lard that largely was going towards these countries.
 
After analyzing the mains factors of price, the other side of the business is the cost of production. Feed - don t expect big changes until harvest, especially for barley and wheat that have a strong position like corn that shows a decent trend in international markets.
 
We expect to have more stable prices this May with little adjustment and definitely better times in the summer.
 
European Markets and trends in last weeks.
 



Genesus Global Market Report
Prices for the week of April 22, 2013

 

Country

Domestic price
(own currency)

US dollars
(Liveweight a lb)

 

USA (Iowa-Minnesota)
 
84.50 USD/lb carcass
 
62.53¢
 


Canada (Ontario)
 
1.50 CAD/kg carcass
 
53.95¢
 


Mexico (DF)
 
19.03 MXN/kg liveweight
 
70.68¢
 


Brazil (South Region)
 
2.29 BRL/kg liveweight
 
51.84¢
 


Russia
 
68 RUB/kg liveweight
 
98.42¢
 


China
 
13.37 RMB/kg liveweight
 
98.36¢
 


Spain
 
1.370 EUR/kg liveweight
 
82.02¢
 


Viet Nam
 
38,000 VND/kg liveweight
 
82.78¢
 


South Korea
 
3,529 KRW/kg liveweight
 
$1.45
 

BPEX UK Pig Meat Market Update

Reports » BPEX UK Pig Meat Market Update   » BPEX UK Pig Meat Market Update - May 2013

07 May 2013
BPEX UK Pig Meat Market Update - May 2013BPEX UK Pig Meat Market Update - May 2013


British Pig Executive Monthly UK Pig Meat Market Update


UK Prices

As is normally the case at this time of year, GB finished pig prices increased steadily during March, rising by about three pence over the month. Nevertheless, with prices low at the start of the month, the average DAPP was less than a penny higher than in February at 156.96p per kg dw. This was over 15 pence higher than in March 2012 and was the fifth highest monthly average on record. The weak pound helped to support prices by increasing the value of imported pork while some tightening of supplies also played a part. However, consumer demand was still subdued, limiting any gains, not helped by cold weather both at home and across Europe. Prices continued to rise into April, reaching 160.71p per kg by week ended 20 April.



Average clean pig carcase weights have remained relatively high throughout the first quarter of 2013, apart from a typical dip in the week before Easter. The seasonal fall which normally begins around the start of March has been less apparent this year, meaning the average weight for the month was over 600g heavier than last year at 79.74kg. This might be attributable to good growth rates earlier in the winter, with firm pig prices also playing a role. Weights have remained well above year earlier levels into April.

The increase in finished pig prices during the month encouraged some firming of weaner prices in March. The monthly average of £47.55 per head for a 30kg animal was over a pound higher than in February and about two pounds more than in March 2012. At this level, prices were at their highest since August 2010. Nevertheless, with feed prices remaining inflated, there is a limit to how much finishers are prepared to pay. Prices continued to rise, albeit more slowly, during April reaching just over £49 per head by week ended 27 April.

The GB cull sow price also followed a rising trend throughout March, averaging 106.68p per kg, seven pence higher than in February, although nearly 15 pence lower than in March 2012. The recent rise is partly attributable to developments in the finished pig market. However, with most sow carcases destined for export, exchange rate movements were also a major factor. Sow prices have been stable on export markets since mid-February but the weak pound meant that higher prices continued to be available for British producers. However, with the situation in Cyprus hitting the value of the euro, there was some decline in the sow price in April, taking it to 104.18p per kg for week ended 20 April.

EU Prices

Average EU pig prices have been largely stable in euro terms since mid-February, fluctuating around €172 per 100kg. The monthly average for March was less than a euro higher than the previous month at €171.93. Prices typically rise at this time of year as consumer demand picks up with rising temperatures. However, cold weather across Europe in March limited demand and this has been exacerbated by subdued export markets, notably Russia and Japan. Nevertheless, relatively tight pig supplies mean that the average price in March remained over ten euros higher than a year earlier. The price stability continued into April, with the average price for week ended 21 April standing at €171.16 per 100kg, still over seven euros higher than a year before.


Comparative EU Pig Prices
(as at 21 April



Figures show % changes in four weeks to 21 April
Source: EU Commission

The stability seen in the EU average price was also apparent in prices in some key Member States, notably those in North West Europe, including Germany, Denmark and the Netherlands. However, prices further south were more varied. Prices in France and Spain were on an upward trend until mid-March as supplies tightened but have since eased back a little. Spanish prices are now the highest among major producers at over €190. In contrast, Italian prices have fallen sharply since mid-February, dropping by over 30 euros in eight weeks to reach just under €164 in the latest week. This was reportedly the result of a noticeable fall in consumer demand for speciality products which account for 70 per cent of Italian pigs.

The weak pound meant that in euro terms the UK reference price continued falling until mid-March. Since then, with prices rising and the pound gaining strength against the euro, the UK price has risen steadily. As a result, having closed to less than two euros in early March, the gap between the UK and EU reference prices had opened to over ten euros by mid-April.

The EU weaner price in March averaged €51.91 per head, an increase of a little under two euros on the month. At this price, producers received less than one euro per head more than the corresponding month in 2012. Prices continued to broadly follow the normal seasonal trend, levelling off as March progressed at a slightly higher level than a year earlier. Despite tight supplies, price rises have been limited by a combination of the lack of upward movement in the finished pig market and ongoing high feed prices.

Sow prices in key EU Member States have been stable since late February, having recovered from the usual seasonal fall either side of the New Year. The key German price was unchanged throughout March at €1.35 per kg and remained at this level through most of April. This was around four cents higher than the average price for February but was five cents lower than in March 2012. German sow slaughterings so far this year have been seven per cent higher than in the same period of 2012. The picture was similar in Denmark and the Netherlands, with prices in March stable at €1.03 and €1.15 per kg respectively.

Uk Slaughterings and Pig Meat Supplies

UK clean pig slaughtering in March 2013 totalled 767,000 head. This was almost in line with the same month last year, being less than 4,000 down on the year. The Easter period is likely to have affected the lower kill with a short week for the Bank Holiday at the end of the month; Easter was into April last year. The Scottish pig kill recorded a decline by almost half. This reduction reflected the increased number of pigs sent to slaughter in England; throughputs in English and Welsh abbatoirs totalled 622,000 head, up 4% on the year. Throughputs in Northern Ireland were 4% lower compared with March 2012.

Adult pig slaughterings were one per cent down on the year at 20,500 head. This was close to the kill figure from the previous month and the small year-on-year decline was again likely due to the earlier Easter. Nevertheless, replacement rates remain relatively high by historic standards, despite the decline in sow prices compared with last year. This is the result of an increased focus on improving herd productivity by optimising the age and parity of sows.

UK clean pig carcase weights averaged 79.2kg in March, a marginal fall on the month but nearly half a kilo up on a year earlier. The ongoing high carcase weights may also mark a shift in processor requirements, as they aim to offset the lower pig numbers expected in the coming months. Northern Ireland recorded a year-on-year increment of over a kilo in their average carcase weight while the Scottish pigs weighed less by a similar amount. However, Scottish pigs account for only a small share of the total and so UK pig meat production was only marginally lower than March 2012 at 63,700 tonnes.

Based on the DAPP sample, estimated GB clean pigs slaughterings were higher in the first three weeks of April, although this was largely because of the earlier Easter. By the middle of the month there were increasing signs that supplies were beginning to tighten, with throughputs down on a year earlier and lower than in the first quarter of the year.



The UK imported 10% less pork in February compared with the corresponding month in 2012, the largest annual fall in more than six months. The easing in import volumes is partially the result of a drop in EU production for the month but demand in the UK has also been relatively weak, with the latest retail figures showed a decline in purchases. In addition the average import price increased by 7 per cent so the total value of pork imports was down by four per cent to £43.8m. Volumes from Denmark were down by nearly 30 per cent and their market share declined to be almost the same level as the Germans. In contrast, shipments from Germany and the Netherlands increased by five per cent and 23 per cent respectively, partly filling in the shortage of Danish pig meat. Reductions were also recorded from other EU Member States like Ireland, France, Belgium and Spain.

Bacon and ham imports continued the downward trend from the start of the year, with a 13 per cent decline recorded in February. With only a marginal increase from the other major suppliers (Netherlands and Germany), a notable 38 per cent drop in Danish imports was the main factor affecting the overall cured pig meat supplies. Further falls were recorded in processed pig meat during February, down by 29 per cent compared with the same month in 2012. Sausage imports also decreased by 13 per cent, which meant that the overall UK imports for February were significantly lower than a year earlier.

In contrast, the UK export market performed better in February, with an 18 per cent year-on-year increase in pork shipments. Volumes of both fresh and frozen increased but the rise was sharpest for the latter, which were up 22 per cent. There were considerable increases in exports to Denmark, likely for re-export, and China (which took 2,200 tonnes). Demand for UK products was also higher in the German and the Irish markets by 14 per cent and 12 per cent. Lower supplies to the Netherlands and Hong Kong did not offset the overall increment. With unit prices slightly higher, the value of UK pork exports increased by 20 per cent to £17.9 million.

Shipments of cured pig meat followed a similar downward trend to recent months but the fall failed to fully offset the rise in pork shipments. During February, bacon and ham exports fell 67 per cent compared to a year earlier, with contributions from all the main markets. Similarly, processed pig meat exports were down 35 per cent on the year as Ireland imported considerably less from the UK. However, as has been the case since September last year, offal exports were much higher, almost doubling with the majority of the increase coming from shipments to Belgium, Germany and China.

Feed Prices

The LIFFE feed wheat futures price, for May delivery, closed at £193.05 per tonne on Tuesday 23 April, representing the lowest closing price since late July 2012. This represents a monthly decline of £5.70, or three per cent, as closing prices ranged between £193 and £204 per tonne within the month. The new crop price (November 2013) closed at £184 per tonne, compared to £185.70 a month earlier.

The CBOT May 2013 wheat price closed at $256.26 per tonne, down four per cent on a month earlier. The maize price recorded a significant monthly decline of $34.54 (12 per cent). The main recent price driver has been crop conditions and weather reports. Grain prices have fallen over the month, following reports of slightly better weather in the US and across Europe compared to conditions in March.

Prices have declined despite crop conditions in the US reported to be behind, as there is still time for improvement. As at week ending 21 April, 35 per cent of the winter wheat crop was reported to be in good/excellent condition compared to 63 per cent at the same time last year. Crop development was also well behind the same time last year. US maize plantings were behind the normal schedule but data shows that, at this stage, there is very weak correlation between maize planting progress and the final planted area and yield.

ADAS report that the UK’s winter wheat growth and development was limited by the cold and wet weather experienced in March. The UK crop condition report will be updated on 1 May and it will show how the improved weather of recent weeks has assisted domestic crops. With a large decline in UK wheat plantings and current crop condition concerns, the size of the UK wheat crop in 2013 is an important issue but it is worth reiterating that grain markets operate in a global environment. Thus, large scale price movements will be dictated by production prospects in wider Europe, the Black Sea region and North America.



The May CBOT soyabean price has also experienced a monthly decline and closed at $521.62 per tonne, down $7.62 on a month earlier as the price ranged between $500.31 and $534.11 during the month.

The global soyabean market has followed the trend of grain prices to some extent but the dominant news has been the tightness in the US soyabean supplies. The market has had to rely on the US for longer than usual this season, due to a slower than expected export pace in South America. Brazil has experienced port congestion while there are reports of reluctant farmer selling in Argentina. However, favourable weather has allowed harvest to progress fairly well in both countries; Brazil’s harvest was nearing completion with about 90 per cent of the crop harvested by 23 April and approximately 40 per cent done in Argentina.


Total Cost of Pig Production Compared with the DAPP



AHDB Market Intelligence

According to AHDB’s provisional estimates, the cost of pig production figure in April fell for the third consecutive month to 162p per kg. A small fall in feed prices remained the main factor affecting the latest cost of production. The estimated figure was around 2p lower than March but was at a similar level to early summer last year, before the rapid rise in feed prices post-harvest. However, compared with the same month in 2012, costs are almost 9p higher but they are lower than 2011 levels for the same period, when feed prices were even higher.

Despite a relative fall in the cost of production, based on the current DAPP producers were still losing an estimated £2 per pig. This is the equivalent to a loss of 3p per kg. However, producer returns have improved since the start of the New Year, with losses estimated to be as much as £7 per pig in January. Forecasts suggest some easing in the feed costs for the remainder of this year, particularly after the harvest, indicating prospects of positive margins. However, this is weather dependent and assumes that pig prices maintain their current level or even strengthen further, based on the expected shortage of EU pig production.

Consumption

According to the latest retail data from Kantar Worldpanel, in the 12 weeks ending 17 March purchases of pork declined six per cent compared with a year earlier. The decline was due to smaller volumes purchased per trip and a reduction in the number of households buying pork as switching to lamb and poultry meat continued from the previous month. However, loin roasting joints continued to post very impressive growth; purchases were up by more than a third, driving expenditure growth of more than half. Spending on bacon and sausages continued to grow, driven by average price rises, but the amount purchased declined. Ham purchases were similar to last year but a decline in average price resulted in a decrease in spending over the 12 weeks.

In the most recent four weeks, purchases of pork continued to decline year on year but at a slower rate of two per cent. Average prices jumped nine per cent, driving expenditure up seven per cent. Spending on bacon decreased slightly as declines in volume purchases accelerated. Sales of sausages also remained behind last year but average price inflation supported expenditure. Sliced cooked ham showed a more positive picture, with spending similar to last year and the amount purchased up one per cent.


Trends in Retail Meat Purchases (period ended 17 March 2013)



Q=quantity purchased , E=expenditure, P=prices
Source: Kantar Worldpanel

Consumer shopping habits change over time, influenced by a number of factors. One of these is technological advancements, such as improved access to high-speed Internet, coupled with growing ownership of mobile devices. But how has this impacted the grocery market? It has never been as important that grocery shopping is shaped to meet the needs of more sophisticated digital consumers. They are looking for initiatives that can save them time and money, or preferably both. This has led retailers to be heavily focused on ensuring better integration between online and offline channels, allowing shoppers to easily and impulsively transition between the two.

The growth and investment in online grocery services has been a key priority for the majority of leading retailers, a trend set to continue. According to Kantar Worldpanel, online sales reached £5.1 billion in the 52 weeks to 17 March 2013. While they still represent a small share of the total grocery market at five per cent, they recorded 19 per cent growth year on year. The opportunity to harness technology doesn’t just stop at getting your groceries delivered to your door. There has also been a notable increase in the number of ‘click and collect’ schemes being rolled out.

Growing access to Wi-Fi in-store and the mobile internet also gives consumers new ways of searching for information while shopping. Quick Response (QR) codes increasingly feature on food labelling. Every month new apps for smartphone are launched; one example is the recent launch of the ‘where’s this from’ app which uses the 4-digit EU identification mark printed on pack to provide consumers with the ability to research more about the product they are purchasing.

With any technological advances there are barriers to overcome; the most notable for meat is the freshness of product. However there are things to consider for those looking to make the most from e-commerce, such as availability of deals on-line, recipe and nutritional information, product photos and customer reviews.

Maximising e-commerce opportunities is not just about the technology, it's about understanding the consumer needs driving solutions. It is also important to remember that for many households, traditional grocery shopping in store will continue. Therefore the choice isn’t whether to operate online or offline but an integration of both.

May 2013

UK Pig Meat Market Trends
15 May 2013


ANALYSIS- A summary of the trends in the pig industry in the UK by senior editor, Jackie Linden, based on the new edition of the 'Pig Pocketbook' from BPEX.

The Pig Pocketbook 2013, just published by the British Pig Executive (BPEX), part of the Agriculture and Horticulture Development Board (AHDB) includes the following chapters:
•Chapter 1 – Marketing chain
•Chapter 2 – Pig numbers
•Chapter 3 – Abattoirs
•Chapter 4 – Slaughterings and production
•Chapter 5 – Livestock and meat prices
•Chapter 6 – Imports and exports
•Chapter 7 – Consumption
•Chapter 8 – Pig carcass classification data
•Chapter 9 – Feed prices

Marketing Chain

In 2012, pig meat production amounted to 825,000 tonnes, up from 806,000 tonnes in 2011. 2013 output is forecast down slightly at 822,000 tonnes.

Imports of pig meat in 2011 were 960,000 tonnes and 978,000 in 2012. The forecast is for this to drop back markedly to 915,000 tonnes this year.

Exports have been stable over the last two years at a little over 200,000 tonnes and are expected to remain at that level in 2013.

This means that total consumption increased from 1.559 million tonnes in 2011 to 1.600 million tonnes last year; the 2013 forecast is 1.531 million tonnes.

Self-sufficiency in pig meat in the UK is 51.7, 51.5 and 53.7 per cent in 2011, 2012 and 2013 (forecast), respectively.

Pig Numbers

The agriculture department (Defra) conducts an annual census of pig numbers in June. Compared to 2011, there were more pregnant sows in 2012 (279,000 and 293,000, respectively). However, the total female breeding herd was lower at 425,000 compared to 432,000 the year before.

The number of gilts for breeding was markedly up (2011: 75,000; 2012: 82,000).

At 3.978 million, there were 41,000 more fattening pigs in the country in June 2012 than 12 months previously.

Abattoirs

At the last count - in 2012 - 121 slaughterhouses in the UK handled pigs, four fewer than the previous year, of which 14 and 16, respectively were specialist pig abattoirs. Average annual throughput was just under 68,000 head in 2012.

Large facilities - slaughtering more than half a million pigs annually - accounted for 67 per cent of pigs slaughtered in all abattoirs and 84 per cent of those processed in specialist slaughterhouses.

Slaughterings and Production

More sows and boars were slaughtered last year (2011: 250,000; 2012: 265,000) and more clean pigs (2011: 9,813 million; 2012: 10.035 million) and therefore more pigs overall (2011: 10.063 million; 2012: 10.299 million).

Average carcass weight has remained stable at a little over 78kg since 2009.

Average sow productivity - based on calculated values rather than a survey - has improved steadily since 2009 and in 2012 stood at 22.3 pigs and 1,748kg meat per sow and year.

Livestock & Meat Prices

Comparing per-kilo deadweight (DAPP) prices month by month, most figures for clean pigs were higher in 2012 than the same month of the previous year.  The differences were negative in June and July but prices were more than eight per cent better in the last quarter of the year than the comparable months in 2011.

There was a different pattern for cull sow prices, with improvements of around 30 per cent at the start of 2012 trending downwards during 2012 to become negative in November and December.

GB weaner prices finished the year at £46.14 per head, or almost five per cent higher than in December 2011.

Comparing retail and producer prices for pig meat, the latter's share has been within the range of 38 to 40 per cent of the retail price since 2009, with just a hint of an upward trend for 2012.

Imports and Exports

In 2012, UK imports - at a little over 885,000 tonnes and worth almost £2.17 billion - were higher than the year before. The increases were the result of higher volumes and values of imported sausages and processed hams, shoulders etc, while those for fresh/frozen meat and bacon were less than 2011 levels.

Denmark was the leading source of fresh/frozen meat imports, accounting for about 28 per cent of the total. Germany, the Netherlands, Ireland, France, Belgium and Spain also exported significant volumes to the UK and small amounts also came from Chile and the US.

Denmark and the Netherlands shared almost equally between them the total bacon imports to the UK last year.

Turning to UK exports of pig meat, the total volume in 2012 (191,515 tonnes) was lower than the previous year (194,874 tonnes). Increases in volume in the fresh/frozen, sausages and processed hams and shoulders were all up but bacon exports - at a little over 15,500 tonnes - were less than half of the figure for 2011. The value of all pig meat exports was up from almost £272 million in 2011 to £275.6 million in 2012.

Several of the top destinations for UK pig meat were in the EU - Germany, Ireland, the Netherlands and Denmark - but substantial and increasing volumes found their way to Hong Kong, China, the US, South Korea and Japan.

Consumption

Multiples account for the overwhelming majority of pork and bacon sales in the UK - 85.0 and 88.1 per cent of the respective totals in 2012.

Per-capita consumption was 25.4kg in 2012, up from 24.9kg the previous year.

In retail volume terms, fresh pork and frozen or loose sausages lost ground in 2012, while sales of bacon, sliced ham and sliced pork were all higher than in 2011. Interestingly, for a period of economic problems, it was the higher-value items (on a per-kilo basis) whose sales went up and the cheaper products declined.

Except for loose sausages, between one-third and one half all sales in each product category was on promotion.

The latest figures (for January 2013) reveal that the percentage of the various categories of products of UK origin were: pork, 82 per cent; bacon, 48 per cent; ham, 60 per cent and sausages, 81 per cent. The percentages with the Red Tractor assurance scheme mark were 60, 27, 25 and 46 per cent, respectively.

Pig Carcass Classification Data

Based on data from the Meat and Livestock Commercial Services (MLCSL) Independent Authentication Service, pig carcass weights followed a typical distribution curve with the median value of 75 to 80kg. For 2012, there was a tendency towards lighter carcasses and as a result, the average for the sample was 78.7kg, down from 79.1kg in 2011.

Almost 80 per cent of carcasses achieved the highest 'S' grade and the rest were a grade 'E'. Just one per cent of carcasses were graded 'U' or 'R'.

P2 fat depths have been showing a minimal decline for the last decade for all weight bands.

Feed Prices

Average compound feed prices per tonne for quarters 1, 2, 3 and 4 of 2012 were £247, £258, £268 and £282, respectively. These compare with £209 in 2009, £217 in 2010 and £255 in 2011.

While feed wheat prices fluctuated round a slowly rising trend throughout 2012 of around £200 per tonne, soybean meal prices jumped up in mid-2012 from around £300 per tonne and seem to have stabilised at a higher plateau of around £500 per tonne ever since.

EU Pig Prices: Price Increase All Over Europe
24 July 2013
 Go to schweine.net

EU - In almost all European countries, pig prices once again went through a considerable increase this week.

The demand for meat is fuelled by the nice weather. As a result of these high temperatures, the growth of pigs is slower.

Slaughter pigs appear to be available in many regions all over Europe to cover demands by slaughter companies.

With its 6-cents’ plus, Germany sets the standard for the other countries for the second consecutive week. The Netherlands and Belgium follow, each with a 6-cents’ per kg increase.

Prices went up by 5 cents in Austria. In France, the trend continues to be positive, with the price going up by a good 5 cents. The quantities on offer are expected to remain scarce as a result of lower slaughter weights.

The corrected Spanish price vaulted the limit of 1.90 euros per kg slaughter weight for the first time this year. According to reports, the Spanish meat business is also going well so as to make the scarce quantities on offer cause prices to increase.

Trend for the German market: Currently, the meat dealers are facing a higher-than-average demand as a result of the summer weather. This is not even slowed down by the holiday season. The quantities on offer are expected to continue to remain substandard. Thus, prices are expected to remain steady at least in the weeks to come.


Week

D

NL

DK

B

F

PL

CZ

IT

ESP

AUT

GB

IR


Week 23
1.546 1.491 1.563 1.495 1.587 1.626 1.633 1.595 1.759 1.479 1.916 1.574

Week 24
1.626 1.566 1.590 1.569 1.649 1.676 1.639 1.627 1.792 1.561 1.944 1.574

Week 25
1.666 1.604 1.643 1.618 1.729 1.716 1.651 1.722 1.873 1.612 1.967 1.594

Week 26
1.666 1.604 1.643 1.618 1.729 1.695 1.657 1.722 1.873 1.612 1.967 1.594

Week 27
1.646 1.557 1.643 1.618 1.737 1.690 1.694 1.722 1.885 1.612 1.953 1.594

Week 28
1.626 1.566 1.643 1.593 1.708 1.692 1.704 1.848 1.885 1.612 1.923 1.594

Week 29
1.686 1.623 1.643 1.655 1.760   1.704 1.924 1.892 1.663 1.929 1.594

Week 30
1.746 1.680 1.671 1.717 1.814     1.975 1.930 1.714 1.947 1.594
Prices in Euros (€)

EU Pig Prices: Unchanged and Increasing Prices
01 August 2013
 Go to schweine.net

EU - The supply of market pigs remains scarce. Lower slaughter weights can be observed in nearly every country and while prices have risen in some countries, they have at least remained steady elsewhere.

In Germany and Austria there was no price increase this week. The meat markets are not as dynamic as in the weeks before.

In the Netherlands, Belgium and France, the scarce supply of pigs allowed a price increase of one cent.

In Spain, high temperature have caused low daily gains of the pigs and in consequence a small supply, so that here a price increase of two cents per kg slaughter weight was possible.

The quotation in Denmark went up by three cents per kg. It is said that the exports, particularly to Russia, are higher than the last few weeks.

Trend for the German market: The current situation should remain the same this week so prices are expected to remain level.


Week

D

NL

DK

B

F

PL

CZ

IT

ESP

AUT

GB

IR


Week 24
1.626 1.566 1.590 1.569 1.649 1.676 1.639 1.627 1.792 1.561 1.944 1.574

Week 25
1.666 1.604 1.643 1.618 1.729 1.716 1.651 1.722 1.873 1.612 1.967 1.594

Week 26
1.666 1.604 1.643 1.618 1.729 1.695 1.657 1.722 1.873 1.612 1.967 1.594

Week 27
1.646 1.557 1.643 1.618 1.737 1.690 1.694 1.722 1.885 1.612 1.953 1.594

Week 28
1.626 1.566 1.643 1.593 1.708 1.692 1.704 1.848 1.885 1.612 1.923 1.594

Week 29
1.686 1.623 1.643 1.655 1.760 1.744 1.704 1.924 1.892 1.663 1.929 1.594

Week 30
1.746 1.680 1.671 1.717 1.814   1.728 1.975 1.930 1.714 1.947 1.594

Week 31
1.746 1.690 1.698 1.729 1.819     2.025 1.949 1.714 1.933 1.594
Prices in Euros (€)

 

Rubber Slat Mats Could Improve Animal Well-being
01 August 2013

EU - New research shows that rubber slat mats could improve swine health.

In a new study in the Journal of Animal Science, researchers in Europe studied how different types of flooring affects claw and limb lesions, locomotion and flooring cleanliness.

According to the researchers, flooring is one of the main factors in production systems that cause locomotory problems in swine. Locomotory problems can be caused by joint injuries or by circulatory problems in the legs and feet.

Julia Calderón-Díaz, a PhD candidate at University of College Dublin, said pregnant sows placed on cushioned flooring would have a lower risk of being lame compared with sows placed on concrete.

In this experiment, researchers studied the effects of two types of flooring on pregnant gilts in Ireland. One hundred sixty-four pregnant gilts were divided into two groups. One group was housed on concrete slatted floors, and the other group was housed on concrete slatted floors covered in rubber slat mats.

The researchers scored locomotion and claw and limb lesion of the replacement gilts and flooring cleanliness periodically. The replacement gilts were observed from the time they were bred until 110 days into their pregnancy.

Dr Alan Fahey, a lecturer at the University College Dublin said the gilts were studied during two pregnancies. The results were similar during both pregnancies. Sows housed on rubber mats had a reduced risk of swelling and wounds on the limbs. However, the rubber mats increased the risk of sole and heel lesions.

Ms Calderón-Díaz said these lesions were possibly caused by slurry accumulation over the rubber mats. She said these lesions were not severe and could be addressed through modifications of the rubber slat mats.

In the European Union, pregnant sows must be group housed four weeks after breeding until one week before farrowing. This rule has been in effect since January. Ms Calderón-Díaz said other countries are likely to use group housing for pregnant sows in the near future.

Irish Pig Prices on a Decline through 2013
08 August 2013

Teagasc


IRELAND - There was a one per cent reduction in total EU pig slaughter in the period January to April 2013 in comparison with the same period in 2012. Total pigmeat production in that period in 2013 was virtually unchanged on the same period in 2012 due to a slight rise in slaughter weights, according to the mid-year outlook for Irish Agriculture 2013.

By mid 2013, pig slaughtering in Ireland was running behind the corresponding figure for 2012 by about 1 percent.

The June 2012 and December 2012 CSO pig numbers showed a decline in the pig breeding herd, indicative of a likely contraction in Irish pig production in 2013, so this observed decline in Irish throughput in 2013 was anticipated.

Pig feed prices rose through 2012 and have remained elevated in 2013, as illustrated in Figure 15.

By mid 2013 pig feed prices were about €60 to 70 per tonne (circa 20 per cent) higher than in the
corresponding period in 2012. To improve the economic performance of Irish pig production, sustained high pig prices were required in 2013 to offset the impact of high feed prices.

Irish pig prices rose through the latter half of 2012 and at the outset of 2013 were about 25 cents per kg ahead of prices at the beginning of 2012 as illustrated in Figure 16. However, Irish pig prices have moved into decline as 2013 has progressed and by July were only slightly higher than at the mid point of 2012.



Having been well below the EU average pig price throughout 2012, the Irish pig price converged on the EU average price in April 2013. However, since then the EU average price has risen by eight cent per kg while the Irish price has fallen by eight cent, opening up a 16 cent price gap between EU and Irish prices by the end of June 2013.

The rise in Irish pig prices in 2013 will be sufficient to ensure that the total value of Irish pig output
will increase in 2013 relative to 2012. However, the end result is that Irish pig producers will remain in financial difficulties, due to high feed prices, which will only be alleviated via a reduction in feed costs or an increase in pig prices.

A decline in feed costs in the second half of 2013 does seem plausible, given forecast cereal harvest prices, but it remains to be seen whether the Irish pig price can recover to closer to the EU average level in the coming weeks and months.

Europe: Hog Markets
22 August 2013
Genesus - The first power in genetics

EU - August is the month where prices begin to change and trend towards lower prices in both feed and pigs, writes Javier Santamartina, Spain, Italy & Portugal Genesus Representative.

Pig Prices continue at good levels close to 1,50 €/kg ($0.91 USD/lb.) pig live and probably close to last year’s high. There are not enough pigs to send to slaughter. In the last 3 weeks the average carcass weight has decreased by 1.675 Kg (3.5 lbs.) and the extremely hot weather has reduced pigs’ growth all around Europe, even in Northern European countries.

As a consequence prices keep at the maximum level and piglet prices have decreased a little, because of most of the finishing barns are full at this time of the year. The impact of both the drop in sow numbers by European Animal Welfare regulations and high feed prices are having their reflection now. It is a general situation with small differences for others important countries like Denmark, Netherlands or France.

Pork consumption continues to be poorer. The market is still facing difficulties in transferring higher cost of production into customers’ prices getting pork at the retail level. Only some countries like Italy were able do it, remember that the Italian market is a little different with heavier pigs 165Kg (364 lb.) liveweight.

On the other hand, this period of time will be reactivated by a dry ham industry. Ham demand is supplied by Spain and Germany increasing the price of ham; unfortunately the rest of the cuts in countries like Spain continue to struggle to increase the price. In Germany there are fewer consumers in summer time, because of holidays where vacationers move to the south of Europe and other countries.

Exports to others countries continue without big jumps. The pork exports ban from Russia continue for countries like Spain. At the beginning of September Russian vets will review the possibility of restarting exports to Russia that were put in place to control the spread of African Swine Fever.

This price seasonality could be finishing at the beginning of September. It would be more hogs in the market plus cooler weather would make a pig getting out from the finishing barn faster. In any case the current higher record price is in a good position to let us think that this year will be a good year.

On the other side costs at the end offers relief to the producers. The current harvest is good in all Europe. Spain is around 20 million hectares, and Eastern Europe, (Russian and Ukraine) a record harvest in global world. North of Africa will produce 12 million more hectares than the previous year. Protein sources continue at a high price but also in the coming months we expect a decrease in price. With this perspective costs in pig production will reduce and complete the margin of business.



Genesus Global Market Report
Prices for the week of 12 August 2013


Country

Domestic price
(own currency)

US dollars
(Liveweight a lb)

USA (Iowa-Minnesota) 93.47 USD/lb carcass 69.17¢
Canada (Ontario) 191.48 CAD/kg carcass 66.55¢
Mexico (DF) 23.73 MXN/kg liveweight 81.82¢
Brazil (South Region) 3.11 BRL/kg liveweight 58.36¢
Russia 74 RUB/kg liveweight $1.02
China 15.46 RMB/kg liveweight $1.15
Spain 1.485 EUR/kg liveweight 90.06¢
Viet Nam 43,000 VND/kg liveweight 92.57¢
South Korea 3,871 KRW/kg liveweight $1.57

Pigs Full of Beans
23 August 2013

National Pig Association - The voice of the UK pig industry


UK - Soya is at the forefront of many people's minds at present, particularly after the references to it in connection with the Amazon rainforest on Newsnight this week. So the following comments from one of Britain's larger producers may be of interest.

"We have found pigs grow faster on beans than on soya — but it's like drawing teeth stopping nutritionists using the bloody stuff.

"50 per cent of our feed is made up of wheat, barley and beans, and oilseed rape at 25 kilos a tonne.

"Our top priority is to reduce the risk of making a loss so some years ago we sold sows and bought land, so that now we grow all the cereals that we consume as a pig producer.

"I can grow beans for about £80 a tonne, compared to about £200 to buy them in and that compares very favourably with soya at around £400 a tonne. We've been up to 30 per cent beans and those have been our fastest growing pigs.

"We grow wheat-wheat-barley-beans and in a good year expect 4 tonnes from the first wheats, 3 tonnes from the second, 3 tonnes of barley, and 2 tonnes of beans — or 3 tonnes average across the rotation.

"A sow with all progeny needs 6 tonnes, so we allow for two acres per sow. What comes out of the back end of the pig provides enough phosphate and potash for two acres, if you grow beans in the rotation, because they don't need anything.

"But the pigs don't give you enough nitrogen, so the beans make an important contribution, because they mean we don't need nitrogen on 25 per cent of our land, and that's a big help.

"The pigs may not produce enough nitrogen, but they do produce plenty of ammonia, and if you collect that and add sulphuric acid, you get ammonium sulphate. We're trying that now to see if it works."

Will Brussels Try to Fudge Origin-of-pork Labelling?
02 September 2013

National Pig Association - The voice of the UK pig industry


EU - Although country of origin labelling for fresh pork will be mandatory from December 2014, Brussels has yet to indicate which labelling model it favours — Simple, Intermediate or Premium.

A lot will depend on its impact assessment, which considers the costs and administrative burden that each model will impose on farmers, food companies, retailers and consumers.

Option 1. SIMPLE

The Simple model would require meat from an animal reared in the European Union to be labelled "Origin EU" and imported meats and meat from imported animals to be labelled "Origin: non-EU".

Option 2. INTERMEDIATE

The Intermediate model would require the following information to be given on the label:
•Member country (or third country) where the animal was reared and slaughtered (minimum period to be fixed).
•Where a minimum rearing period is not met, "Origin: EU" or "Origin: non-EU" would apply.

Option 3. PREMIUM

The Premium mandatory labelling model would be similar to mandatory beef labelling, which is already in force.

Meat from an animal born, reared or slaughtered in more than one country would have to be labelled with the following information:
•Member country (or third country) where the animal was born.
•Member country (or third country) where the animal was reared.
•Member country (or third country) where the animal was slaughtered.

Meat from an animal born, reared and slaughtered in one country would be labelled simply with the single country of origin.

A year ago, Brussels may have been persuaded by food company lobbyists to recommend the Simple model to ministers.

But as a result of Horsegate, and other food scandals around the world, the European Commission now recognises that consumers are increasingly concerned about where their meat comes from.

One recent study found that 48 per cent of European Union consumers look for country of origin information when buying fresh meat or meat products.

Brussels is required to come forward with recommendations for ministers and to adopt the necessary implementing acts by December this year, in time for inclusion in its new labelling regulation (No. 1169/2011) which comes into force in December 2014.



This is the kind of labelling that British pig farmers find offensive. On the front it says "Yorkshire Ham" but on the back, in much smaller print, it says "Cured, cooked and packed in Yorkshire using pork from the EU". [Photo: NPA]

For their part, many British pig farmers will be hoping Brussels chooses the Premium labelling model.

But it is likely there will be pressure on Brussels from producers in Denmark and the Netherlands, who export considerable numbers of young pigs, to choose the Simple or Intermediate model.

British pork and pork products earn a premium of around ten per cent on the home market, a commonplace differential when a country is a net importer of a food product.

British pig farmers are weary of food companies, retailers and caterers cashing in on this differential by passing-off imported product as British — sometimes with considerable skill and agility.

Even in blatant cases of misleading labelling, wrong-doers tend to escape with a telling-off, because Trading Standards avoids expensive court actions where legal grey areas mean success is far from guaranteed.

ACMC Tip: Choice of Terminal Sire is Vital
05 September 2013
ACMC Breeders
UK - With feed costs being the major financial component of rearing pigs, any improvements in feed conversion efficiency are enormously important.

With the boar contributing 50 per cent of the genetics to this generation, the correct choice of terminal sire is vital, says ACMC veterinary consultant, Paul Thompson.

In particular, those producers using their own boars and on-site AI, or natural service, should regularly discuss with their breeding stock supplier the selection and upgrading of these boars to take advantage of on-going genetic improvements.

Weather Has Big Impact on Supply Chains
04 October 2013
 

UK - "Many farmers are still working under the shadow of 2012’s appalling weather and the knock-on impact this has had," said Phil Bicknell, NFU Chief Economist at a recent Monmouthshire NFU Cymru county meeting.

Mr Bicknell went on to say, "For most, the problem is now in the office - working to balance the books and covering production costs. Looking ahead to next year, I’m hoping we can move on to a more positive outlook."

Members present at the NFU Cymru meeting held in Raglan, scrutinised past production figures and future projections for the UK red meat, cereal and dairy sectors.

Mr Bicknell said, "Margins are constantly being squeezed as we pay the price for the awful weather conditions experienced in 2012, which was extended further by the most challenging spring in decades. This has put serious pressure on the bottom line with profits being eroded.

"Cash flow problems have naturally followed, farmers have been faced by increased bills and less favourable credit terms with some merchants. It will take time to rebuild confidence within the industry but there should be some confidence. The global population is increasing and as the world gets richer, people improve their diets. Demand for meat will increase considerably and the challenge for UK farmers now, is whether we can assist in meeting this demand.

"The future is looking stronger but there is going to be more volatility in commodity prices. As an industry, costs of production since 2006 have rocketed from £9bn to £14bn and we can never underestimate the impact the weather can have on the supply chain."

As the Union is due to launch the 2013 confidence survey, it is expected that this year’s main factor in determining confidence within the industry will be the outcome of the Common Agricultural Policy (CAP) negotiations. Over recent years, input prices have been the main factor concerning farmers but the current CAP discussions and decisions taking place at a Welsh Government level are clearly at the forefront of farmers’ minds.

Monmouthshire NFU Cymru County Chairman, Nigel Bowyer, said, "There are significant changes ahead under the new CAP regime and the uncertainty at the moment is making it extremely difficult for farmers to plan ahead and make informed business decisions. Profit and confidence within the agricultural industry are key components in order for re-investment to be made on farm. It is absolutely vital that the Welsh Government exhaust every avenue possible to try and minimise the impact of moving to an area based system in Wales."

Spain: Hog Markets
10 October 2013
Genesus - The first power in genetics

SPAIN - Last week I was in Spain attending some meetings with old customers and visiting new ones, Fernando Ortiz, Genesus Ibero-America Business Development.

The market is getting a second wind after a couple of years of terrible hog prices with higher feed costs. It was just around June 2012 when the market started to get some reaction over the pick of the 1.40€/kg ($0.86USD/lb.). Also over the last two years 2012 and 2013 the Spanish market has been able to keep the better prices longer, breaking records of several weeks under seasonal pressure.

My trip overlapped with the drop in prices not only in Spain but also in the whole EU. There is a huge supply of hogs, heavier ones and a kind of rush to get them killed. The good weather has helped a lot as well. Over the last four weeks prices have descended almost 13 Euro cents (17 USD cents) per kilogram liveweight (from 1.533€/kg to 1.404€/kg) ($0.94-$0.86 USD/lb.).

The European Union’s markets have similar behavior and trends due to their synchronization and dynamics. Trading among countries is very efficient and fast and pork trading is not the exception in this equation.

Below current prices from some European countries:



Spain has been the only European market able to get much higher prices this year compared with the same period a year ago. Italy has experienced the same thing but Italy is considered a market with big differences hard to associate with other members of the European Community. Italy’s slaughter weights are too high (160-176 kg) (352-388 lbs.) and this makes the market atypical. Holland, Denmark, Belgium and Poland did not hit the marks for this year. Their hog prices were lower YTD. Having said that we expect an even stronger correction in prices in Spain, considering the highest they reached this year, in order to match the other countries in the region.

The good news for this particular period of the year is that pork prices at retail level are seeing lower reflecting slaughter prices, however pork consumption in Spain is gaining some ground at the moment and the market has very fluid circulation with lower cold storage inventory.
It was interesting, from my recent trip, listening to important pork producers in this country how the demand for good quality pork is escalating the markets at faster pace. As everyone knows Spain is mostly a Pietrain country and I remember just a few years ago how anyone who talked about Durocs sounded like they were profaning a culture. That means they are turning their heads to find a breed that responds to this trend while feed efficiency continues to be an important part of the equation: Duroc was the response. There have already been trials with Genesus Duroc and they got the right product to supply the demand and obtain more profits. These observations came out not only from producers but also from major packing plants.

The market is very dynamic everywhere and always is important to be prepared with the right product your client demands. Genesus is up for the challenge!



Genesus Global Market Report
Prices for the week of September 30, 2013


Country

Domestic price
(own currency)

US dollars
(Liveweight a lb)

USA (Iowa-Minnesota) 89.8 USD/lb carcass 66.45¢
Canada (Ontario) 179.7 CAD/kg carcass 62.78¢
Mexico (DF) 22.97 MXN/kg liveweight 78.98¢
Brazil (South Region) 3.74 BRL/kg liveweight 76.90¢
Russia 75.58 RUB/kg liveweight $1.06
China 15.99 RMB/kg liveweight $1.19
Spain 1.404 EUR/kg liveweight 86.09¢
Viet Nam 45000 VND/kg liveweight 96.72¢
South Korea 3338 KRW/g liveweight $1.41