Processors were urged to take action now to keep their position in the ’lucrative market’
Europe’s pork industry must invest to continue as the key exporter to China’s ‘lucrative’ market, according to research from Rabobank.
European pork processors exported 1.8 million tonnes of pigmeat to China last year, up from 1.1mt in 2015, helped by strong demand and high prices.
But Rabobank expected 2017 and beyond would be tougher for European traders.
Exports were expected to drop to 1.6mt this year as prices for Chinese meat dropped and other pork-producing regions increased their exports.
And Rabobank warned processors they must take action.
Justin Sherrard, global strategist in animal protein at Rabobank, said: “The question now is what European processors will do to keep this good thing going. The environment is getting ever-more competitive but it does not mean the EU industry is powerless to act.”
He advised European processors to build long-term trade partnerships with Chinese pork processors and share investments in product innovation and marketing or to invest directly in the country.
Mr Sherrard added: “Last year was a favourable climate for EU traders selling to China, but from now on it is likely to be less easy.
“That is why it is the right time for agribusinesses in Europe to invest so they can continue to capitalise on China’s colossal appetite for pork.”
The United States, the second-largest exporter, sold more than 500,000t of pork in 2016 and US meat exporters have also highlighted the need to be ‘aggressive’ with their marketing efforts after a slowdown in shipments.
Philip Sang, chief executive of the US Meat Export Federation, warned its competitors would ‘quickly fill the void if we do not defend our market share’.
The slowdown reflected a recovery in Chinese production following a fall in feed prices after the Government dropped a guaranteed corn price scheme and moved to sell Government stocks.