According to PKO BP experts, favorable ratios of livestock prices to feed prices, indicating improved profitability of breeding in the first months of 2024, had a positive impact on the EU pork supply.
Eurostat data shows that pig slaughter in the EU in the period from January to April was 3.7% higher. y/y, of which in Poland they increased by nearly 11%. y/y. Production in Denmark also rebounded (+1.9% y/y), as did in Germany (+2.9% y/y), we read in the forecast.
However, the restriction on exports works to the detriment of breeders:
EU pork exports decreased by 12% in the first four months of 2024. y/y (-95 thousand tr/y). To the greatest extent, by 34%. (-81 thousand t) sales to China decreased. Nevertheless, the country was still the largest market for EU pork with 23%. participation in shipments to third countries. However, it is worth noting that in 2020 this share exceeded 60%. – experts say.
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Prices of fattened pigs remain stable for now, but there is a market collapse in the air
Are we at risk of suspending exports to China?
PKO analysts also commented on Beijing's actions, which created the risk of introducing tariffs on pork from China. In response to tariffs on Chinese electric cars, the country officially launched an anti-dumping investigation into pork imports from the EU in late June.
– If it materializes, it would be an impulse to drop prices on the Community market. Spain was responsible for more than half (51%) of EU exports to China in 2023, PKO experts estimate.
What are the forecasts for the fattening pig market?
– We expect that in the second half of the year the average domestic purchase price of pigs will be 9-14 percent higher. lower than in the same period last year. The increase in production in the EU, driven by a better situation in livestock production, lower demand on third markets and lower cost pressure due to drops in feed prices support such a scenario. However, the forecasted recovery of consumer demand will lead to price increases, summarize the bank's analysts.
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The fattening pig market is starting to stabilize. What are the prices in domestic slaughterhouses?
