European Commission Issues Pork, Beef Market Reviews

On Aug. 28, the European Commission released its latest EU Pork Market Review and EU Beef Market Review.

The European pork market was obviously shaken by the Jan. 30 closure of the Russian market, historically the largest destination for EU pork exports. But EU pork/pork variety meat exports in the first half of 2014 were down just 2.5 percent year-over-year to 1.27 million metric tons (mt), meaning alternative markets were found for most of the roughly 200,000 mt of pork that would have otherwise gone to Russia. First-half export growth was large to Japan (180,373 mt, +50 percent), South Korea (99,295 mt, +74 percent) and the Philippines (73,598 mt, +71 percent).

EU hog prices trended lower in six of the past seven weeks and are now down 14 percent year-over-year in euro terms. In U.S. dollars, prices averaged $98.45/cwt, down 15 percent. But with a more rapid decline in U.S. prices, EU prices are now higher than those in the U.S. for the first time since February.

On the beef side, the EU is the supplier most impacted by Russia’s recent import ban, which took effect Aug. 7. Russia was the EU’s largest beef/beef variety meat export market in the first half of this year, taking 45,890 mt (+79 percent) valued at $135 million (+53 percent). Total EU beef/bvm exports in the first half were 178,489 mt, up 31 percent. In addition to Russia, exports were sharply higher to Hong Kong (22,290 mt, +97 percent).

EU chilled beef imports in the first half of 2014 were up 4 percent to 58,353 mt, with growth from Australia, Brazil, Uruguay and the United States offsetting smaller volumes from Argentina. For the recently concluded quota year (July 1, 2013 through June 30, 2014), imports from the U.S. were 17,664 mt, up 5 percent from the previous quota year. Total duty-free quota utilization was 41,335 mt, up 28 percent and equivalent to 86 percent of available volume. Through Aug. 29, imports in the current quota year totaled 7,696 mt. With four weeks to go before the end of the current quarter, there is growing concern that the 12,050 mt quarterly allocation could be filled.