Dear readers,

The price hike may be the best of the good news, but we have more:

• The U.S. Department of Agriculture announced $115 million in grants. The funding includes $77 million to 10 recipients through a program that backs start-ups or expansions of meat and poultry processing, while $38 million will be provided through a slaughterhouse expansion program to support five independent producers.
• A three-year, one-million-dollar grant from the USDA’s National Institute of Food and Agriculture will help expand the use of data collected through the Swine Disease Reporting System to identify disease trends and improve swine health.
• The National Pork Board of the USA announced a new five-year effort to address consumer questions related to the pork industry and strengthen consumers’ confidence in choosing pork for their plate. Entitled “The Real Pork Trust Consortium,” the effort combines the expertise of Iowa State University, the University of Georgia, North Carolina State University, North Carolina A&T State University and the University of Minnesota to focus on three key areas aimed to build consumer trust.
  1. Research designed to answer consumer questions about pork and pork production
  2. Communications that share the research findings in a relatable, relevant way consumers can easily understand and use when making decisions
  3. Training to empower people from various walks of life to share research-based information about the pork industry
•  From June 1 to 27, the export of quota crops (wheat, barley, corn, rye) OF Russia amounted to 4.54 million tons, which is 2.5 times higher year-on-year. In particular, corn export increased by 15% to 392`000 tons, and barley export more than doubled to 378`000 tons.

The shipment of wheat to Egypt this month increased 4.8 times, to 788 thousand tons, and to Turkey – 1.6 times, to 732 thousand tons. Quite surprisingly, Brazil emerged as a third-largest importer, 226`000 tons of Russian grain were shipped to this country.

It’s The End Of The World As We Know It (And I Feel Fine)

In our region, ASF is spreading to Croatia with many outbreaks close to the last week reported Bosnia-Herzegovina case. Given the geographical and political map of area is hard to estimate how the three national authorities will manage to get over decades of antagonism and cooperate in order to contain and combat the disease, while having to manage also a large backyard pig population that provides income to the local population.

Even, despite Proposition 12, there is a lot of political support for our industry in the USA, negative livestock margins are determining decrease in the pig numbers. USDA reports producers intend to farrow 2.94 million sows during the June-August quarter, down 4% from the same period last year. Also, farrowing intentions for the September-November quarter at 2.95 million sows, similarly down 4% from the same period last year.

Europe, on the other hand, has a generally different political approach.

One issue is tail docking. The University of Wageningen (the Netherlands) has produced model calculations which show that, if tail docking were banned, all the associated measures and losses would amount to between €9 and €26 per slaughter pig. The large range shows the different costs that farms would have to apply. However, for most farms, the study suggests that the upper end of the range would apply. Nevertheless, practitioners defend shortening on the grounds that it is a step that paradoxically reduces the risks of much more extensive injuries and subsequent suffering of the animals by a smaller intervention.

This is only one political measure determining strong reduction in the pig numbers.

Data from France show 500,000 fewer pigs slaughtered in 25 weeks, a drop of 6%. Also, heat stress steps in, weights went down 1,5 kg in the last 3 weeks.

Only 20.7 million pigs were kept in Germany as of May 3, 2023. This is the lowest number since 1990, when 30.8 million pigs were kept in German stables. The current animal numbers correspond to a decrease of almost 652,000 pigs or 3.1% since the last count on November 3, 2022. The number of fattening pigs fell by 1.7% in the last six months. The number of piglets fell by 5.2% and the number of young pigs by 3.2%. Compared to the previous year’s count on May 3, 2022, the stock  fell by 7.3% or 1.62 million pigs. In a two-year comparison, the population fell by 16.1% or 3.99 million animals. Over the last ten years, the stock has fallen by 7 million pigs or 25.2% since 2013.

Meanwhile, the German Federal Minister of Agriculture Cem Özdemir has ordered that the catering at his events should be vegetarian. Meat is only available with a special permit. Two other federal ministries have similarly strict requirements. The remaining twelve departments see no need for this.

Cem Özdemir said when presenting the key points for a nutrition strategy at the end of 2022: „I don’t want to tell people what they should eat.” It took less than a year to do the opposite. It is a total  disregard to the once European leader German meat industry! Can he still be considered the leader of the German agriculture, with this attitude? And how far will people follow such a leader? I prefer to avoid historical references…

The German reference price increase was not a surprise for me. I’ve estimated this level in several meetings and discussions in the last months. I keep hearing arguments against: decreasing consumption, inflation. While changing consumer behavior is a fact, inflation is temporary. Producers are adapting to the changing market and decreasing inflation will bring back buyers to the pork shelves. This time, east of Europe went before the market and paid unprecedented bonuses for the pigs. The market became competitive for the Spanish, French, Belgian meat, it was not anymore a place to get rid of some extra pork. Leveling of prices in an open market is a normal consequence.

Will the price decrease? With the strong reduction of the sow population in Europe, it will take over two years to repopulate barns and over 3 years to have relevantly increasing pig population. And this is the biological limit, politics a nd ASF will still work on the opposite.

It’s The End Of The World As We Know It (And I Feel Fine).

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

COUNTRY	PIG(EUR)	TREND	PIGLET(EUR)	TREND	OBSERVATION
GERMANY	2,50 HW		93/25 kg
NETHERLANDS	2,23-2,54 HW		79/25 kg
BELGIUM	1,83 L		77/20 kg
DANEMARK	1,85 HW		93/25 kg
FRANCE	2,344 HW
ITALY	1,82 L- 115 kg, 2,14 L-160kg,DOC		135/30 kg
SPAIN	2,02-2,05 L		95-105/20kg
PORTUGAL	2,8 HW
AUSTRIA	2,37 HW		100 /25 kg
POLAND	1,89-2,21 L		92-138/20-30 kg		Partner info; no quotation
CROATIA	2,10-2,6 HW		110-123/ 25 kg		Partner info; no quotation
SERBIA	2,08-2,13 L		115-131/ 25 kg		Partner info; no quotation
CZECH R.	2,48 – 2,52 HW		82-88/ 25 kg		Partner info; no quotation
SLOVAKIA	1,95 -2,1 L		110-121/25 kg		Partner info; no quotation
HUNGARY	1,98 – 2,15 L		110-121/ 25 kg		Partner info; no quotation
ROMANIA	2 – 2,17 L		110-121/25kg		Partner info; no quotation