Global pork production has returned to profitability after several months of herd contraction, according to a new report from Rabobank.
The report shows a dip in consumption in key Asian markets during the first quarter of the year, however pork continues to maintain its position as a cost-effective protein choice for consumers worldwide.
Higher global stocks of grains and oilseeds have resulted in lower feed costs for producers, helping to boost the industry.
Better herd health in the US, Canada and China is also helping to stabilise production.
Senior animal protein analyst at Rabobank, Christine McCracken said that meaningful growth in the breeding herd is not anticipated until late 2024 or early 2025.
The report stated that return to growth in the breeding herd is unlikely before late 2024 or early 2025, and pork supplies are likely to remain constrained in the coming months.
“This is particularly significant in light of rising beef prices. The trend toward frozen products and home cooking is expected to continue bolstering retail pork sales, with a projected uptick in value-added and processed meat sales as inflation rates peak,” McCracken said.
Europe
In Europe, pork production increased by 4% in January this year compared to the same period in 2023.
This reflects a recovery in production after the holidays rather than a strong increase in the number of slaughter animals, according to Rabobank.
Pork production was up year-on-year in Poland by 18%, Spain by 7%, France by 6% and Germany by 5%. Production in the Netherlands and Italy was flat.
In Denmark and the UK, production decreased by 15% and 1%, respectively.
Managing disease pressure, such as African Swine Fever (ASF) in some countries and Porcine Respiratory and Reproductive Syndrome (PRRS) in Spain, will be a “key factor” for determining production development, according to Rabobank.
Although pig prices are trending lower compared with year-ago levels, down 6% year-on-year in week 12 of 2024, Rabobank expects prices to rise further this year as supply remains tight.
Piglet prices have been exceeding the prior year’s levels, up 3% year-on-year in week 12, but Rabobank expects seasonal decline later this quarter.
Pork exports
Structural declines in Europe pork production and reduced import demand have left a significant hole in global export markets that is quickly being filled by competing nations, mainly North and South America.
Structural changes to production in Europe have prioritised domestic markets at the expense of exports.
Since forfeiting 7% of global pork export market shares since 2020, the EU now accounts for less than 40% of total global exports.
On a whole muscle basis, the US is set to overtake the EU in annual pork export volume, while Brazillian pork exports will outpace those from Canada.
Rabobank expects a slight rebound in pork exports in 2024 driven by the stablisation in production.