Future prospects look good for EU pork and beef

The beef industry has benefited from the expansion of dairy herds in northern Europe, which has led to an increase in the supply of bulls and calves for fattening and slaughter, explained the report. This factor, coupled with low feed prices, means that production is forecast to increase this year and next. However, the EU beef cow herd is expected to decline further over the course of next year, with the most significant cuts anticipated to be in Ireland and the UK.

A question mark still stands over where EU exports of beef, which had been destined for Russia, will now go. Last year Russia imported around 46,000MT (cw) of beef from the EU, but exports to third countries destinations such as the Balkans and Hong Kong increased by about 20,000MT (cw) during the first half of this year, so it seems likely the EU will be able to redirect imports to markets such as these.

Belarus has been touted as a potential new market for EU live cattle, which would mean the country would be able to slaughter these animals for the Russian market.

EU beef consumption is expected to recover slightly, but this will mainly be in the form of lower-quality cuts. According to the report, consumption of beef in the highest quality segment is constrained by availability rather than demand.

Pork exports will also be affected by the Russian ban. However, the report suggested that alternative markets were likely to be found due to the tight supply of pork on the world market. Russia placed restrictions on pork imports from all 28 EU member states in February this year as a result of an outbreak of African swine fever (ASF).

However the outbreak of porcine epidemic diarrhoea virus (PEDv) in Japan, South Korea and the US has benefited EU pork, which upped exports to these countries, as well as the Philippines and Taiwan, in the first half of 2014.

Another issue affecting the swine sector is the gradual reduction in piglet production in the new member states, particularly Poland, which has seen a drop in piglet numbers of 800,000 over the past two years. The outbreak of ASF in Eastern Europe has also had an impact and could influence EU exports to third countries if it spreads further. France and Italy are also expected to cut piglet production, while Denmark, Germany, the UK, Spain and the Benelux countries are forecast to increase numbers.