Semi-Annual Report 2008
Elevated
beef and milk prices slowed down the contraction of the European Union (EU)
cattle herd. The elevated beef prices are partly a result of restricted beef
imports. During 2008, EU beef imports are even expected to decline further
as the European Commission (EC) strengthened the import requirements for
Brazilian beef. The limited supply of beef on the EU market is forecast to
revive cattle farming in the New Member States (NMS). Increased supply of
pork and rising feed costs induced a “return of the pig cycle”. Despite
government support, the EU pork sector lost market share in its two most
important markets, Russia and Japan. Due to these dim market conditions, EU
pig and pork production is anticipated to fall during 2008. The most
significant cuts are anticipated in the NMS. Competitive producers in
Northwestern Europe are expected to maintain or even increase their
production.
 GAIN
report E48025 (March 2008)
Annual Report 2007
Bulgaria
and Romania joined the EU to form the EU-27 at the beginning of the year.
This should only have minor impacts on EU meat markets, although meat
imports will drastically decrease as a result of EU legislation. The EU beef
market continues its slow decline in production and consumption again in
2007, after a spike in 2006 as a result of increased slaughter in the UK and
increased veal consumption in the Mediterranean. EU beef imports continue to
further increase, while beef exports further decline because of lack of
supplies and high domestic prices. The EU pig and pork market is peaking in
2007, after a profitable 2006. However, oversupplies and increased feed
costs are eating into this profitability and pork production is forecast to
slightly decrease in 2008. EU pork exports are forecast to loose market
share in 2008, while the increase in domestic pork consumption is forecast
to level off.
GAIN report
E47060
(July 2007)
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"Poland
May Benefit from Pork Import Quota offered by Ukraine"
GAIN report PL8015 (April 2008). According to Poland's
Ministry of Agriculture, Ukraine has offered Poland a 25,000 MT per
month quota for exports of pork. Within quota tariffs are zero. If EU
export restitutions and pork begin to flow up to the limits of the
quota, the restitution could equal $12.5 million each month in payments
to exporters by the EU commission through Poland's Agricultural
Marketing Agency (AMA). Pork exported to Ukraine must originate from
Poland. This action may help the Polish pork industry with difficulties
from high feed prices and the high exchange rate of the Polish zloty
versus the Euro
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"EU
suspends Brazil beef imports; at least temporary "
GAIN report E48016
(January 2008). DG
SANCO effectively suspends Brazil beef imports from January 31, 2008, as
a consequence of the refusal to publish the Brazil list of eligible
cattle farms. The Brazil Ministry of Agriculture, Livestock and Food
Supply had put the ball in the EU camp by submitting a list ten times
longer than DG SANCO had suggested and announcing a further extension.
The Brazil beef export suspension is expected to last until a new FVO
audit, starting February 25, 2008, returns favorable. If unfavorable,
this audit will probably trigger a full EU import ban for Brazil beef.
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"Netherlands | Opportunities on the EU Meat Market"
GAIN report NL7032
(December 2007). Due
to CAP reforms and high feed costs, EU beef, pork and poultry production
is under pressure. At the same time, the European Commission is
enforcing EU legislation on imports. As a consequence, sector sources
anticipate higher prices and increased opportunities for high value
cuts, such as from the United States.
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"EC
Standing Committee approves restrictions on beef imports from Brazil"
GAIN report
E47112 (December 2007).
On
December 19, 2007, the Standing Committee on the Food Chain and Animal
Health (SCFCAH) approved a Commission Decision that imposes stricter
traceability requirements for Brazilian beef exports to the EU after
another FVO audit identified continuing deficiencies. Expectations are
that these restrictions will reduce the number of eligible ranches from
more than ten thousands to just a few hundred. While these restrictions
will only affect raw beef imports, EU beef prices are expected to
increase. EU beef exports are expected to further decrease from the loss
of competitiveness, especially as competition from Brazil beef exports
to the world will increase.
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"Export
subsidies for raw pork reinstituted" GAIN report E47104
(December 2007). On November 29, 2007, the
EC reinstituted export refunds for raw pork in an attempt to support
waning pork exports which result from the unfavorable €/U.S. $ exchange
rate. EU pork farmers are suffering severely from high feed costs, even
as EU pork prices are still at the 5-year average level. EU feed costs
are the result of a poor EU grain harvest and the impossibility to
import cheap feed ingredients as a result of the EU GM policy.
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"U.S.
Exports to the EU increasing despite EU oversupply situation"
GAIN report E47102 (November 2007).
U.S.
pork exports to the EU are increasing strongly as they benefit from a
weak dollar vis-à-vis the Euro and simplified EU quota administration
rules. The paradox is that these increased exports occur in an EU pork
oversupply situation and while the EC approved a scheme to temporarily
remove pork from the EU market. EU pork producers are suffering from
uncompetitive export conditions and high feeding costs.
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The Benelux
Beef Market GAIN report NL7008 (April
2007). This report describes marketing opportunities for U.S. beef in the
Benelux region. FAS/The Hague estimates that U.S. beef could further
penetrate the Benelux market, elevating the annual import volume from 300 MT
to more than 3,000 MT.
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EU honors U.S. request to change rules on licensing
for pig meat import TRQ
GAIN report
E35040 (March 2005):
On February 25, 2005,
Commission Regulation 341/2005 was published, which increased the maximum
licensing quantity for the pig import TRQ into the EU from ten to twenty
percent. The change to the licensing procedure was approved upon request
from the U.S. Government and was implemented on March 1, 2005.
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U.S. beef
faces strong competition on the European market
GAIN Report E35178 (September 2005):The EU became a net beef importer in
2003. U.S. interests in increasing beef exports to this large market are
growing. However, there are important hurdles that U.S. beef exports must
overcome to be competitive. Market access for U.S. beef is highly restricted
by the EU hormone ban and only beef from the Non-Hormone Treated Cattle (NHTC)
program is eligible. U.S. beef is
also facing strong competition from
South-American beef exports.
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