EU exports decline in January
At 183,000 tonnes, the EU exported 2% less pork in January than last year, according to the latest data from Eurostat. Average prices were also 3% lower, reflecting a drop in farm gate prices. As such, the value of exports was 5% back on year earlier levels, at €423 million.
Asia continued to dominate the market, despite a significant 22% decline (-17,000 tonnes) in shipments to China compared to year earlier levels. Chinese pig prices have been declining significantly since mid-January, suggesting the market is currently oversupplied and these lower domestic prices also reduce the competitiveness of imported product. Exports to Hong Kong also fell 32% (-3,500 tonnes) year-on-year during the month.
Nonetheless, other Asian destinations partly counteracted the decline in shipments to China. Exports to Japan increased 15% (+3,800 tonnes), while South Korean volumes were up 28% (+5,700 tonnes) and the Philippines grew 42% (2,600 tonnes) year-on-year. Despite rising domestic production, demand from the US was strong with volumes increasing 71% on year earlier levels to 10,800 tonnes.
Offal exports were also lower in January 2018 compared with the previous year. At 105,000 tonnes, volumes were 13% less than year earlier levels, and lower average unit prices meant the value was back 21% at €129 million. As for pork, lower shipments to both China (-18%, 13,300 tonnes) and Hong Kong (-34%, 6,400 tonnes) drove the overall decline. With Greater China accounting for around 70% of EU offal exports, it is more difficult for expansion to other destinations for compensate for lower Chinese demand. Nonetheless, EU offal exports to most smaller markets did increase on the year in January. In particular, shipments to South Korea increased 54% (+1,500 tonnes) and Ukrainian volumes grew 69% (+1,000 tonnes). The EU also sent 1,200 tonnes of pig offal to Australia during the month, contrasting with negligible volumes in previous years.
Bethan Wilkins, Analyst
email@example.com, 024 7647 8757