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AHDB Pig Market Weekly


27 February 2012

AHDB UK Market Survey - 24 February 2012AHDB UK Market Survey - 24 February 2012

The value of UK red meat exports increased by a quarter in 2011 as tight global supplies resulted in increased export volumes and higher unit prices.

AHDB

Increased value of trade in 2011

The total value of exports was £1,048 million, with beef exports accounting for £437 million, sheep meat exports £380 million and pig meat exports £231 million.

The value of beef exports represented an increase of 32 per cent on the year, as volumes increased by 29 per cent and the price two per cent. The increased volume was attributable to a shortage of beef across a number of markets on the continent resulting from increased exports to non-EU markets from these countries. The value of sheep meat exports was 19 per cent higher on the year. The export price increased seven per cent while volumes were 11 per cent higher. The increased volume was attributable to higher production and a shortage of product on the continent as a result of lower supplies from New Zealand. With tight supplies of lamb in most markets, there was increased competition for product resulting in record prices during 2011. In 2011, the value of pig meat exports was 19 per cent higher year on year as unit values increased two per cent and volumes were 15 per cent higher.


The market conditions which have led to an increase in export values have also resulted in the value of imports increasing. Tight supplies of product in key producing nations has generally resulted in lower supplies of red meat globally, which has limited import volumes for beef and sheep meat especially. The total value of imports in 2011 was five per cent higher year on year at £2,664 million. Beef imports accounted for £855 million, sheep meat imports £411 million and pig meat imports £1,399 million.

Despite beef imports falling one per cent in volume terms the value increased 11 per cent as a result of a 13 per cent increase in the import price. This increase in price was the result of considerably higher procurement costs, with farmgate prices in most countries rising in 2011. Similarly sheep meat imports fell 13 per cent as shortages in the majority of trading regions were apparent, these tight supplies resulted in substantially higher prices for sheep and as a result the import price increased 23 per cent on the year.

The total value of pig meat imports increased two per cent on the year as a six per cent increase in the price offset a four per cent decline in volume. There was variation between bacon and pork. Bacon import volumes were down 10 per cent, with the value six per cent lower. In contrast, as the volume of pork imports increased by two per cent and the price was seven per cent higher, the value of pork imports increased 10 per cent to £721 million.

Cattle market trends



Prices

In week ended 18 February 2012 the deadweight prime cattle average price increased two pence on the week to 334.7p per kg. With the colder weather in the last two weeks potentially boosting sales of beef and the availability of finished cattle remaining tight this price is the highest achieved so far this year. Prices for all categories of cattle increased with the largest being a four pence rise in the average R3 young bull price to average 330.3p per kg.

In week ended 22 February, despite prime cattle throughputs at GB auction markets declining six per cent on the week, the average prime cattle price was only marginally higher. This was largely as a result of a two pence fall in the average steer price, down to 187.4p per kg. Heifer and young bull average prices both increased a penny on the week to 193.2p and 181.1p per kg respectively.

Trade

Exports of fresh and frozen beef in December totalled 10,500 tonnes five per cent higher year on year. Volumes to the Netherlands fell five per cent but this was more than offset by a 30 per cent increase in shipments to Ireland and a 72 per cent increase in trade to France.

In the year as a whole fresh and frozen beef exports totalled 142,500 tonnes, 29 per cent higher on the year. Shipments to the Netherlands increased 39 per cent, to Ireland 25 per cent and to France 31 per cent. Overall, volumes to other EU Member States increased over a quarter and still accounted for the bulk of all shipments. Despite relatively small volumes exports outside the EU grew substantially. Volumes to Hong Kong increased eightfold, to Ghana fourfold, and there were increases to numerous other markets.

Imports in December declined by more than four per cent year on year to 23,000 tonnes as supplies in a number of markets remained tight. Supplies from Ireland were five per cent lower on the year, from Uruguay they were down 12 per cent and there was a 33 per cent fall in shipments from Australia. Volumes from Argentina were down a half, while product from Botswana remained banned.

In 2011, import volumes were down one per cent at 235,000 tonnes. Notably supplies in South America and Africa were tight. Lower volumes were somewhat offset by increased imports from a number of other EU Member States, Australia and New Zealand.

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