Photo of Subdued retail sales not helping EU pig prices

Bethan Wilkins


AHDB Pork Market Intelligence


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Subdued retail sales not helping EU pig prices

Home \ Prices & Stats \ News \ 2018 \ August \ Subdued retail sales not helping EU pig prices

With growth anticipated in EU pig meat production across 2018, forecasts from the EU commission and others have expected EU pig meat consumption to increase this year.

However, looking at the latest retail figures, demand has remained under pressure in the main EU markets in 2018 so far. Changing consumer preferences are often discussed in relation to the UK market, however similar challenges are being faced across Europe.

In Germany, the largest pig meat market in the EU, household purchases of fresh pork in January-June this year were almost 3% below year earlier levels. A 3% rise in retail prices, despite lower prices at farmgate level, may have influenced the decline in sales volumes. Similarly, in Spain, sales volumes were down 4%, while prices were 5% higher year-on-year, during the first quarter. In France, the situation was worse, with sales volumes declining over 6% year-on-year between January and June, despite a smaller 1% rise in average retail prices.

The charcuterie market in Germany and France has also proved challenging. Purchases were down in the first half of the year in both countries, although with rising retail prices there was some growth in market value. Conversely, demand fared better in Spain, at least in the first quarter of 2018. Volume sales increased by almost 1% year-on-year, despite rising prices.

Another positive area has been Italy. Although volumes of fresh pork sold only recorded a small increase on the year for Q1, this is a positive signal for demand considering prices averaged 3% higher.


Despite the subdued retail sales, if EU production, imports and exports are balanced for the Jan-May period, pig meat supplies available for consumption seem to have increased so far this year. Stable export volumes, coupled with a 5% growth in EU production, mean supplies on the EU market were 6% above 2017 levels earlier this year.

While some of this additional product may have been stored, the rise in supply availability also suggests more pork is being consumed in foodservice or as processed products, markets that are typically more price sensitive than retail. Channelling more pork through these avenues has likely contributed to lower pig prices so far this year.

This may also explain why UK pig prices have fared comparatively better than the EU as a whole. Kantar Worldpanel figures suggest total UK pig meat retail sales volumes were stable in the first half of the year. However, according to balance sheet estimates in the latest UK pork outlook, supplies available for consumption may have fallen slightly, due to lower import levels. Displacement of imported product in the UK retail market may therefore have been supporting UK pig prices. For the first half of 2018, UK pig prices averaged 5% below year-earlier levels, whereas the EU average pig price averaged 12% below.

For prices to pick up again, supplies will either need to tighten, or demand increase. Reports suggest the hot weather has slowed supplies on the continent in recent weeks, however with breeding herds expanding in a number of key producing states, supplies seem unlikely to remain short over the coming months. The global market remains a challenging place this year, so an increased focus on stimulating retail sales volumes may be needed in order to boost the European market. However, positive developments in this area also seem challenging, especially with ongoing retail price inflation. The outlook for EU pig prices over the coming months therefore seems fairly pessimistic at present, which will inevitably have a knock-on effect on the UK market.


Bethan Wilkins, Analyst, 024 7647 8757