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EU Pork Exports Strong in February

EUPorkExports

The European Union’s pork/pork variety meat exports were up 21 percent year-over-year in February, reaching 222,548 metric tons (mt). January-February exports totaled 434,532 mt, up 7 percent from a year ago and up 3 percent from the same period in 2013. Exports to China/Hong Kong were up slightly at 185,065 mt, accounting for 43 percent of the EU’s total export volume. Year-over-year growth was led by South Korea (50,529 mt, +64 percent), the ASEAN region (39,517 mt, +27 percent), the United States (17,769, +45 percent), Australia (16,913 mt, 101 percent) and Taiwan (6,893 mt, +183 percent).

In 2013, when the EU last had access to Russia throughout January and February, Russia took 65,960 mt of EU pork/pork variety meat in this two-month period. This volume is now finding a home in alternative markets, especially in Asia.

On a related note, trade officials from the European Union and Japan began their 10th round of bilateral trade agreement negotiations this week. The talks are scheduled to run through April 28. This is viewed as a key juncture in the negotiations, as it is likely the last round of talks prior to the May 29 EU-Japan summit, when European Council President Donald Tusk and European Commission President Jean-Claude Juncker will meet with Japanese Prime Minister Shinzo Abe.

EUHogCarcassPrices

EU pig prices have managed to edge higher over the past five weeks. In the third week of April, prices averaged $70.28/cwt – up 4 percent from last month but still down 11 percent year-over-year in euros and down 31 percent in U.S. dollars. EU prices were 14 percent above U.S. prices for the week – similar to the premium seen in 2010-2011 but smaller than the price difference in 2012-2013.

EU piglet prices eased after gaining for 11 consecutive weeks, averaging $47.56. Even with the recent gains, piglet prices were still down 16 percent year-over-year and up just 1 percent from the previous month.

The European Commission expects a modest 1.25 percent increase in EU pork production this year, reaching 22.96 million mt. Pork exports are expected to rebound to 2.017 million mt in 2015, up 5 percent. (Note: this projection is for muscle cuts in carcass weight equivalent. When variety meats are included, exports were record-large in 2014). 2016 exports are expected to increase by another 6 percent. Factors favoring exports include the weaker euro and larger domestic production, partly reflecting lower costs for feed and fuel.