After two consecutive years of increased pig meat production in the European Union, 2012 marked a 2% decrease. High feed costs, the restructuring process or the implementation of new welfare rules are the main drivers for such a decline in herd numbers and in meat production.
Tight supply conditions are likely to continue in 2013 at a very similar pace (-2%) as indicated by the December 2012 survey and by slaughtering data for the first months of the year. The census set the EU live swine herd lower by 1.8% against the previous year at 145.8 million heads, driven mainly by the dramatic fall in Poland (-14.7%) and lower numbers in Spain (-1.5%), France (-1.4%) and Denmark (-0.5%); on the contrary, Germany’s herd, which accounts for 20% of EU total, increased by 3.4%, partially offsetting the decline in the other countries.
As for production, increased slaughterings in Germany (+1.3%) in the first months were not enough to compensate for the declines in Denmark (-7%), Spain (-3.7%), France (-2.3%), Netherlands (-5%) and Poland (-1.4%).
Lower supplies maintained meat prices at high levels throughout the first quarter of 2013 (EUR 172 per 100 kg c.w. in March); a slight relief in prices could be observed in May due to sluggish demand, but prices started to pick up again in June. Firm prices and limited supply are expected to lead to a decrease in both consumption and exports in 2013.
On the trade side, data for the first four months indicate a decline by 2% in pigmeat exports mainly due to Russia (-2% compared to the same period of last year).
April EU exports to Russia increased by 27% compared to their respective 2012 figure, in spite of some restrictions introduced by Russia on certain EU meat. In addition, the Russian ban on the US and Canadian pigmeat exports in place since February should favour EU exports into Russia. Nevertheless, and despite the recovery of Russian imports and the increased demand in China (+78%) and Japan (+5%) in early 2013, exports are expected to decline by 6% given the limited supply over the whole year.
Projected lower cereal prices on the assumed good 2013 harvest are expected to help increase production and stabilise consumption in 2014.
With the accession to the EU, Croatia will add approximately 1.2 million heads to the EU total pig herd (December 2012 census), sourcing 86 thousand tonnes of meat per year or a small 0.4% of EU pigmeat production.