Brazil meat scandal: limited damage to pork
It seems not even a corruption scandal facing one of the world’s biggest meat exporters was enough to dent Brazil’s pork trade in the first quarter of the year. In fact, overseas sales with all markets increased by 8% to around 175,000 tonnes (t), according to Rabobank’s Pork Quarterly Q2 report.
Rabobank’s report also indicated there was nothing on the horizon to suggest the category would do anything but rise.
Production is set to increase by 3% this year, thanks to lower costs. And after a challenging 2016, the Brazilian pork industry looks set to deliver improved results across all areas this year.
Positive outlook globally
Some of the key importers of Brazilian pork are China and Russia. In the first quarter of 2017, Russia imported 67,000t of pig meat from Brazil. After Chinese imports of Brazilian pork increased by a third last year, fresh trading figures showed volume grew by 40% in the first quarter of 2017 alone.
Elsewhere in the global pork industry, stability is the word, as rising supply in the Americas will continue to be easily absorbed by Asian imports, supporting prices.
“The overall outlook is positive right now,” said Justin Sherrard, global strategist of animal protein at Rabobank. “The demand market will continue throughout Q2, supporting margins along the supply chain.”
In China, the government-driven relocation of pork production continues to move forward. Local supply will start to recover in the third quarter of 2017 after years-old investment starts to bear fruit.
US pork production will increase by 4% this year and low prices are putting pressure on exporters from the EU.
Meanwhile, the EU pork market is “booming” as tight supply lifts pork prices, although this high price could see European producers undercut by lower-value exporters.
