East dominates EU pork exports
The month of October saw China double shipments of EU pork exports, taking volumes to 182,300 tonnes, according to AHDB Pork.
The industry’s levy board claimed that this is a new record level, beating the previous one set in October 2014 by 7%.
China wasn’t the only Asian country that experienced a solid month of EU pork exports in October. Japan exported over 40% of EU pork than the previous year.
The two countries accounted for over half of exports for the month, compared to less than a third the previous year.
AHDB Pork said that most of the other major buyers of the product took a considerably less amount than the previous year. In particular, South Korea and Hong Kong were highlighted as seeing significantly sharp falls.
A decline in prices slowing in regards to the euro has meant that average prices were only 4% lower, whilst the value of exports saw a 3% increase on the year at €413 million.
However, EU offal exports for October didn’t perform as well as they did for last year. Though there was a 10% growth in shipments to China, this was counteracted by a drop of a quarter in sales to Hong Kong.
As a result, overall volumes dropped 6% compared with October 2014. Unit prices were also lower, meaning that the value of trade was down 10% on the year at €126m.
Stephen Howarth, market specialist manager at AHDB Pork, explained the growth.
"The main factor is what’s going on in terms of the Chinese domestic market. Through a lot of last year they had very low pig prices and their feed prices were relatively high because of the way the Chinese government was managing the market. That meant that there was quite a reduction in the size of the Chinese pig herd through last year. Some estimates have put it as much as a 10% in regards to the size of the breeding herd.
"That obviously has a knock on effect in terms of their production levels this year. Because their industry is modernised, most of their loss has come from the smaller back yard-type farms, so actually the production is not down nearly as much as the breeding herd is down, but it’s still a couple percent down.
"That’s meant that the pig prices have gone quite high this year. There’s both a shortage of supply – which has helped pull in some imports – but also high prices that have made China an attractive export destination for exporters."
He added that the EU has stepped up its game in terms of competing for export markets.
"The EU has improved it’s competiveness to China. They’re the favoured supplier in a lot of ways, partly because they don’t use the growth hormones that they use in the US which the Chinese don’t want in their pork, so they tend to look towards the EU and the weak euro has helped that as well. It’s made us more competitive against the US in particular on the Chinese market this year."
Want more stories like this in your inbox?
Sign up for our FREE email newsletter