World meat industry news

By the end of 2022, the cost of pork production, which had been growing during the first six months, began to return to last year's values. Yuri Kovalev, General Director of the National Union of Pig Breeders (NSS), spoke about this at the conference “Agroholdings of Russia – 2022” organized by Agroinvestor. In 2023, according to him, the cost price should remain stable.

According to the union, the increase in pork production in agricultural organizations in January-October 2022 amounted to 7.8% (+313 thousand tons). At the same time, the growth trend increased from +5.8% in the first quarter to +9.3% in the third. By the end of the year, the increase may exceed 8% (+350 thousand tons in live weight). With such a significant increase in production, the industry expected a significant drop in wholesale pork prices, at least 10%, Kovalev noted. According to him, in fact this did not happen, the decrease was 5-6% (118.3 rubles / kg).

The head of the NSS also said that pork consumption increased in 2022, this year it is a record one - in January-September the figure increased by 7.8% to 3.1 million tons (+226 thousand tons). “The main reason is that the wholesale price of pork was decreasing, while retail prices practically did not grow or even decreased against the backdrop of promotions,” Kovalev explained.

Among the main factors for the increase in pork consumption, he also named payments from the state to various segments of the population, a significant reduction in the difference in the cost of poultry and pork, which leads to a partial flow of demand towards pig products, as well as an increase in beef prices. Falling prices for grain and meal helped to survive the decline in pork prices and maintain profitability in the industry, Kovalev added.

According to him, in the next three years, the annual production of pork in agricultural organizations can grow to 6 million tons. At the same time, the top 20 market players by 2025 will increase annual production by 25% compared to 2022. Their total increase during this time will reach 1 million tons. Taking into account the decline in production from other producers and losses from veterinary problems by 230 thousand tons, over the same period, the total production in agricultural organizations will increase by 775 thousand tons (+ 14%).

Kovalev noted that the potential for exports of pig products is limited to those world markets that are already open to Russia. The only thing that can change the situation is the opening of the Chinese market. “This country consumes about 60 million tons of pork per year, it will always import 3-5 million tons of this type of meat, and for Russia this is a huge potential. Today, everyone is working to open the PRC market for our country. There are no other serious points of export growth at the moment,” he concluded.