January 16, 2014
China, Saudi Arabia''s poultry demand to boost EU exports
The European Commission in its "Prospects for Agricultural Markets and Income in the EU 2013-2023" report stated that "dynamic import demand in the Middle East, especially Saudi Arabia, and China is expected to continue and should boost EU exports."
Poultry meat has partly made up for the reduced availability of beef. Thanks to short rearing times and the fact that it is relatively easy to invest in the sector, poultry meat production has maintained its recent steady upward trend, though at a slower rate than before. Higher feed costs and the economic environment had a significant impact, reflected in slower growth in 2011-13.
In a context of growing world demand, EU exports grew substantially in 2010 (+24%) and 2011 (+12%). Nevertheless, respective export growth was much weaker in 2012 (+2%) and 2013 (+1%), as strong demand in some African countries (mainly South Africa and Benin) and the Middle East (Saudi Arabia) was offset by fewer shipments to Hong Kong and Russia. Lower export refunds in October 2012 and their complete removal in January 2013 for chicks and in July for frozen poultry carcasses seem not to have had a noticeable effect on exports.
Imports in 2012 remained rather stable at around the same level as in the previous year, but increased by 3.4% in 2013 in response to firm growth in domestic consumption. Higher imports from Thailand (for which a quota for salted raw poultry meat was opened in July 2012) compensated for the shortage of supply from Brazil (a result of production constraints and exporters focusing more on Asian markets). Cautious spending in an uncertain economic environment saw consumption slowing down in 2011 and 2013 unlike 2012, when consumption of other meat fell sharply. Per-capita consumption in both the EU-N13 and EU-15 is around 20–21 kilogrammes.
Though below the record 2011 and 2012 levels, the increase in poultry production is expected to be hindered by feed costs staying relatively high. Poultry meat will remain the most dynamic meat and expand at a rate of 0.8% annually in 2012-23. Production is expected to reach 13.6 million tonnes by 2023.
According to current projections, the dynamic import demand in the Middle East (especially Saudi Arabia) and China is expected to continue and should boost EU exports to 1.4 million tonnes in 2023 (15% above the 2010-12 average). Exports are expected to grow by 120,000 tonnes as compared to 2012, with greater demand also from South Africa and Ghana. Meanwhile, projected production increases in Russia will lead to a contraction in import demand there. EU imports should fluctuate around the tariff rate quota level (-800,000 tonnes).
On the other hand, cow-milk output may rise to 157.3 million tonnes from 150.4 million tonnes, with most of the increase absorbed by cheese production, the European Commission said. Cheese making may climb to 10.7 million tonnes from 9.67 million tonnes, with exports advancing to 1.02 million tonnes from 806,000 tonnes in 2013.
The FAO''s index of dairy prices averaged 242.9 points last year, the highest ever and up from 95.6 points in 2003. EU production of foodstuffs from cheese to poultry to wheat is predicted to climb by 2023 on demand for exports and the manufacturing of biofuels from grains, the 28-nation bloc said.
By 2023, annual grain output is seen climbing to 316.1 million tonnes from 304.3 million tonnes in 2013, while total meat output is seen rising to 45.5 million tonnes from 43.7 million tonnes last year, the EU wrote in an online report.
According to the report, the EU''s grain, meat and dairy industries are all expected to benefit from global demand. The EU produces 20% of the world''s wheat and pork and accounts for 30% of global cheese exports, based on data from the United Nations'' Food & Agriculture Organization.
The EU area growing arable crops is expected to remain stable at 57.8 million hectares (142.8 million acres), with an increase for soft wheat, corn and rapeseed at the expense of barley and durum wheat, according to the report. Soft-wheat planting may rise to 24 million hectares by 2023 from 23.3 million hectares last year.
Grain consumption is projected to climb to 297.9 million tonnes in a decade from 279.8 million tonnes in 2013, led by a doubling in use of cereals to make fuel to 20.6 million tonnes from 10.1 million tonnes. EU grain exports are seen climbing to 31.1 million tonnes from 27.4 million tonnes.