Inside Pigs
Rabobank predicts more demand from China again
The record high temperatures in Western Europe have led to lower pork production in recent weeks. In addition, Rabobank writes that consumers were reluctant to buy pork. What consequences does this have?
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The above sentiment is also reflected in the carcass prices, because they have started to mutate sideways in recent weeks; These showed an increase until the second quarter of 2019. At the same time, piglet prices are showing a decline, although these prices are still well above the 5-year average.
Rabobank writes that import demand from China has been slow in recent weeks. This is also described by ABN Amro. Rabobank expects demand to pick up again in the coming quarter. This should also ensure that price pressure is maintained in the coming quarter and that the price declines that usually occur in September are reversed.
No expansion expected
Despite these relatively strong prices, most producers in Europe are not expanding. Recent figures from the German government (May count) show that the sow herd in the country has decreased significantly (-2,9%, compared to 2018). The bank further writes that a similar trend is visible in Denmark, where the sow herd fell by 2019% in the second quarter of 4,7.
According to the bank, the continued risks of African swine fever are the main reason for the declining figures. Especially in Eastern Europe the virus is spreading rapidly; the areas affected are also reporting new cases. On the other hand, the bank reports that developments in Belgium are more positive. In that country, for the first time since September 2018, 1 week has passed without a new case being found.