Ukraine sees sharp drop in meat imports

Reports have indicated that during the period, imports of poultry amounted to 38,400t, which is 31% lower than the same period in 2013, while pork imports declined by 76% to 26,200t. Cattle, edible offal and by-products fell by 29% to 15,900t and frozen beef imports were 44% less at 1,400t.

However, the press-service for the Ministry of Agrarian Policy reported that the drop in meat imports have been fully compensated by the rise in the domestic production of meat.

“Meat production in Ukraine, excluding the temporarily occupied territory of Crimea, amounted to 2.3 million tonnes in live weight in the period of January-September 2014, which is 5.7% more than during the same period last year,”​ it said.

Official data from the Ministry indicated that the most noticeable rise in volume had been achieved in the chilled meat sector. The production of chilled poultry in the country during the period rose by 4.4% year-on-year, to 523,000t, pork by 10.6% to 165,000t, while chilled beef increased by 10.4% to 38,300t.

The production of frozen poultry meat jumped 21.5% to 112,000t and frozen pork production rose by 22.9% to 9,400t, however the volume of frozen beef produced in the country decreased by 29.4% to 12,200t.

The fall in imports may also been linked to the fall in the exchange rate of the hryvnia and a slight drop in meat consumption in the country. According to a report from the Ministry of Economic Development and Trade this year, the consumption of pork will reduce by 100g per person per year to 20.8 kg. It is assumed that the volume of production of more expensive beef may fall by 400-500g, while poultry consumption may rise by 100-200g.

The Ministry of Economic Development and Trade has also noted that the fall in pork consumption is connected with the “tough economical situation in the country”​. However, the consumption of pork is only expected to see a marginal decrease, by 20,000t year-on-year in total, which will not heavily impact the country’s meat industry.

A recent study by the National Scientific Centre (Institute of Agrarian Economics of Ukraine), said the current market situation, coupled with the rise in the cost of meat production and the changing consumer tastes of Ukrainian citizens may impact the level of profitability of different sectors of the meat industry.

“The level of profitability of livestock production in Ukraine is expected in 2014 to be 15.8%, which is 4.5% more than last year”​, according to the director of the Centre, Yuri Lupenko.

“Profitability of pork production will rise by 9.5 times to 7.6% compared with 2013. Also we will see the significant jump in profitability of poultry production. If last year it was unprofitable – with the level of profitability ‘minus 10%’ - then in 2014 the level of margin will amount to 6.9%. At the same time, by the end of the year, a number of sectors of meat production will remain unprofitable, including production of meat of sheep and goats (-41.3%) and beef (-36.5%),”​ said Lupenko.