Dear readers,

Besides the rising price levels, let’s see some other good news:

• JBS USA-owned Swift Prepared Foods is opening a $200 million meat processing plant in Columbia city, Missouri.The plant will process Italian meats, following up on the JBS acquisition of Italian processed pork brand Principe, part of JBS S.A.’s $92.5 million deal for Italy-based King Groupo.

• 60 projects, led by 38 states, universities and industry organizations have been awarded $15.8 million by the USDA Animal and Plant Health Inspection Service (APHIS) to focus on the nation’s response and control to animal disease outbreaks, through National Animal Disease Preparedness and Response Program (NADPRP).

• The Dutch slaughterhouse Gosschalk from Epe in the province of Gelderland has increasingly got into financial difficulties in recent months. The Dutch Fuite Group wants to get into the dilapidated slaughterhouse at short notice. The Gosschalk company announced that the partner was willing to provide the necessary financing for the continued existence of the company in Epe.

• Last week the Tönnies subsidiary Tican Danemark, for the first time in many years, has set its own producer price above that of the industry leader Danish Crown

• The Australian Meat Processor Corporation and Meat & Livestock Australia have brought nine scientists from around the world together in Sydney for a day-long summit to discuss the scientific evidence in support of red meat and livestock production in today’s society.

Events calendar:

• The Annual Conference of the British Society of Animal Science will take place in Birmingham, between 28-30 of March

• RAM Market 2023 is held in Vic, Spain, between 31 of March and 2 of April

Lost in the Supermarket

            Certainly, we are happy to see the prices rising again. Particularly, the north of Europe shows interesting developments.

The Danish pig price, all through increasing, is still well behind one of the main competitors. Tican raising it’s head in the market dominated by Danish Crown may be a sign of a competition that we see in the neighboring Dutch market. Sebastian Laursen, who had only been employed as CEO of Tican for a year, was only fired two weeks ago. Steen Sönnichsen, former board member of Westfleisch and Danish Crown is now responsible for the business of Tönnies in England, Spain, Poland and Denmark. As usual, when the pig price is below the neighboring markets, danish piglets are sold in high numbers to other countries. Can Tican reverse the tendency and produce a phenomenon similar to the one in The Netherlands? Let’s not forget, Tönnies cannot export to the main Asian markets from Germany, but the contacts are there and Denmark is licensed for business in Asia.

On the Dutch market, the Farmer Friendly cooperative obtained again a much higher price for the pigs of the members than the one the local slaughterhouses are paying. While the large Dutch slaughterhouses are offering a quotation of 2.0-2.09 €/kg. hot weight, the German competitors are offering 2.35 €/kg hot weight for the Dutch farmer’s pigs. Will this equalise the dutch and german refference prices in the near future?

However, in Belgium the perspectives are different. The expansion of the Export Slaughterhouse in Tielt, from 1.5 million slaughtered pigs per year to 2.4 million, will definitely not happen. The Council for Permit Disputes rules that Flemish Minister of the Environment Zuhal Demir correctly refused the environmental permit. So the option for the Belgian pig farmers continues to be the export of piglets and pigs to Spain, mainly. Carcasses are pouring to the east of Europe, while slaughtering numbers are declining in the range of 15% weekly.

But even at this price level, most of the farmers are struggling to make a profit. Why? According to evaluations done by Prof. Thomas Roep from the Rhein-Ruhr-Sieg University of Applied Science, the German food retail trade has increased the selling price of mixed minced meat from almost 4.80 to almost 8 €/kg since 2017. Retail primarily used the 67% increase in price to triple its share of sales revenue from 9% to 27%! On the other hand, last year, for the first time, farmers received less than 50% of the proceeds from the sale of minced meat. The revenue share of the meat companies also fell from 26 to 18% within five years.

           With this approach, the food trade was able to increase its margin for mixed minced meat from 0.43 to 2.17 €/kg within five years. That is an increase of over 400% or €1.75/kg. Of this, €0.99/kg went to consumers, who simply had to pay more. A further €0.66 was borne by the farmers and €0.10 by the meat companies because the food trade no longer reimbursed them for the full production costs. Conclusion: the farmer’s money is lost in the supermarket!

https://www.youtube.com/watch?v=cmpRLQZkTb8

European pig and piglet prices: HW= Hot weight; L= live weight;

COUNTRY	PIG(EUR)	TREND	PIGLET(EUR)	TREND	OBSERVATION
GERMANY	2,33 HW		83/25 kg
NETHERLANDS	2,08-2,35 HW		75,50/25 kg
BELGIUM	1,7 L		73/20 kg
DANEMARK	1,72 HW		83/25 kg
FRANCE	2,379 HW
ITALY	1,90 L- 115 kg, 2,21 L- 160 kg, DOC		134/30 kg
SPAIN	1,99-2,02 L		101-111/20kg
PORTUGAL	2,782 HW
AUSTRIA	2,29 HW		95 /25 kg
POLAND	1,69-2,03 L		80-126/20-30 kg		Partner info; no quotation
CROATIA	2-2,50 HW		100-108/ 25 kg		Partner info; no quotation
SERBIA	2,05 L		99-108/ 25 kg		Partner info; no quotation
CZECH R.	2,22-2,29 HW		75-81/ 25 kg		Partner info; no quotation
SLOVAKIA	1,9-1,95 L		100-105/25 kg		Partner info; no quotation
HUNGARY	1,86-1,95 L		98-109/ 25 kg		Partner info; no quotation
ROMANIA	1,76-1,9 L		100-109/25kg		Partner info; no quotation