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Livestock products

Meat
Milk and milk products

Meat

Most production growth sluggish in 1993

Growth in overall meat production remained sluggish in 1993, often constrained by relatively high prices for feeds and by animal diseases. Production rose in Asia, Latin America and North America, but fell in Africa, Europe, and in countries of the former USSR.

Consumption per caput and trade slightly lower in 1993

Reduced growth in incomes in many major markets depressed demand for meat and in 1993 consumption per caput declined for the first time since 1982. Consumption fell in the developed countries, particularly in eastern Europe and in countries of the former USSR where difficult economic conditions continued to limit households' purchasing power. In other developed countries consumption continued to shift towards poultry at the expense of both beef and pork. In the developing countries, except in Africa, per caput consumption rose slightly with a continued shift towards pig and poultry meat at the expense of bovine and sheepmeat.

Sluggish demand growth and new trade barriers depressed the 1993 volume of international trade.' All meat categories were affected except poultry, for which, however, growth slowed down considerably.

Overall, increases in international meat prices in 1993 compensated for the contraction in volumes so that global meat export earnings remained virtually unchanged. Preliminary indications were for a faster growth of global meat production in 1994.

International trade in meat products was likely to recover in 1994, owing mainly to prospects for faster expansion in pigmeat and sustained growth in poultry meat sales.

Poultry meat

World poultry meat output maintained the fastest momentum among the various categories of meat. Production in the United States reached a new record. It increased slightly in the EC, but stagnated in Japan influenced by rising production costs. In countries of the former USSR shortages of feeds and veterinary products continued to constrain output. In contrast, fast growth was reported again in China, although rising feed costs tempered the pace of expansion. There was a more modest increase in Thailand, limited by increasing land and labour constraints. Output also rose in Latin America, where greater protection to the sector was provided through more restrictive import policies.

Unlike the other meats, trade in poultry was estimated to have expanded in 1993, albeit at significantly lower rates than in previous years. EC imports rose modestly; in July, variable levies were reduced in parallel with intervention prices for cereals. Purchases by countries of the former USSR, made mostly under concessionary terms, fell. Shipments to Canada, Japan and Poland also declined. In Poland, the decline followed the introduction of a minimum tariff in May. Among the developing countries, larger imports were recorded in Egypt, Hong Kong, Saudi Arabia and China. However, many governments, especially in Latin America and the Caribbean, imposed higher import duties or more stringent veterinary restrictions to constrain imports and thus protect their domestic poultry sector. Exports from the United States reached a record in 1993, as Strong consumer preference for breast meat continued to enable the export of dark cuts at relatively low prices. Increased overseas sales were also made by Brazil, China, the EC and Thailand.

World prices of poultry products continued to fall in 1993 reflecting productivity gains in the United States, the leading exporter, and keen competition on international markets.

Prospects for world poultry meat production were for continued fast growth in 1994, with expansion in most regions. However, a further contraction was expected in some countries of eastern Europe and the former USSR.

International trade in poultry meat was forecast to accelerate in 1994, stimulated by rising import demand of Argentina, Japan and Saudi Arabia, to be met by larger exports from Brazil, China, and the United States. Prices for poultry meat could continue their downward trend, reflecting abundant supplies and import restrictions.

Pigmeat

Global pigmeat output stagnated in 1993 reflecting a continued fall in the developed countries and much diminished growth in the developing countries. Prospects in the United States indicated a small contraction in output. By contrast, production expanded in the EC as a result of herd retention in 1992 which was associated with buoyant prices and expectations of cheaper feed costs. The subsequent glut drove producer prices down and prompted the reopening of a EC Private Storage Aid scheme in 1993. Production fell in most eastern European countries under the effects of rising feed prices. Growth in China slowed down considerably, breaking a long-term trend, and reflecting a massive elimination of animals following outbreaks of Foot and Mouth Disease (FMD). In Nigeria production expanded considerably seemingly as a result of increased supplies of cassava feed.

Preliminary estimates on world trade in pigmeat indicated a small decline in 1993. This mirrored reduced imports by Japan and Mexico, whereas shipments to the countries of the former USSR probably remained close to the reduced 1992 level. By contrast, relatively high domestic prices in the United States prompted an increase in imports. Amongst the exporters, the main decline was in shipments from the United States and China. By contrast, sales from the EC rose, owing mainly to larger exports to the United States and to Countries of the former USSR, the latter supported through special export refunds which were at least twice as high as those targeted to other destinations. The decline in pigment supplies in major exporting countries supported pigmeat export prices, a tendency which was reflected in a reduction in most EC export refunds.

World production of pigmeat was forecast to regain some momentum in 1994. Production increases were expected in Brazil, following enlarged harvests of soybeans and grains there, and in China, Pork output was also likely to rise in the EC reflecting increased animal numbers and lower feed prices. World pigmeat imports were anticipated to rise in 1994, owing mainly to larger purchases by Japan, Mexico and the United States, to be met by greater exports from Brazil and China, and from the EC where reduced domestic prices would stimulate exports. However, the possibility of further outbreaks of animal disease in EC member countries and in China could constrain exports.

Meat: international prices

Little change in international prices for pigmeat was anticipated.

Bovine meat

In 1993 global bovine meat production declined slightly for the second consecutive year. In the United States, output remained stable as weather-related losses incurred in the first quarter were offset by large productivity gains later in the year. In the EC output declined substantially reflecting reduced cattle numbers and large exports of live animals which were stimulated by higher export refunds. In eastern Europe and in the countries of the former USSR reduced cattle numbers and rising feed prices again resulted in lower beef output, however, the rate of decline was less than in 1992. In Oceania, by contrast, higher production was anticipated. Output also increased somewhat in the developing countries mainly reflecting an expansion in Asia, particularly in China. Output was stable in Latin America and the Caribbean, while in sub-Saharan Africa slaughter production was down as cattle were not only reduced in number by the 1992 drought but were also retained for rebuilding the depleted herds. However, in a number of countries in North Africa and the Near East production was sustained by large imports of live cattle.

World trade in bovine meat fell in 1993, influenced by increased protection of some major markets which outweighed liberalization elsewhere. Purchases by the United States, the world's leading buyer, were lower reflecting the reduction in the volumes allowed under the Meat Import Law and the Voluntary Export Restraint Agreements (VERAs) with Australia and New Zealand. In addition, Canada reacted to an upsurge of beef imports in the first quarter of 1993, by imposing an annual tariff quota on imports from countries other than the United States. Purchases by countries of the former USSR were also down. New duties were imposed by Mexico at the end of 1992 reducing imports in 1993. In the Republic of Korea the Government sustained producer prices by withholding imported supplies from the market. EC imports increased slightly. Purchases by Japan also continued to rise, favoured by a lowering in import tariffs from 60 percent to 50 percent in April, the last reduction agreed under the market liberalization programme. Larger imports also were made by other countries, including China, Malaysia and Saudi Arabia. Among the suppliers, Canada and New Zealand increased exports. In contrast, shipments were reduced somewhat from the United States, because of reduced exportable supplies, and from Australia, reflecting more restricted access to North America and Mexico. Beef exports from the EC remained close to the high levels of previous years, although this was associated with much larger sales of live cattle. Bovine meat shipments from Argentina and Brazil were also reduced.

Higher prices were obtained in 1993 for bovine meat shipped from Foot and Mouth Disease (FMD) free areas to the world's largest beef importer, the United States, reflecting reduced production there in the first half of the year and a cut in imports under the VERAs with Australia and New Zealand. However, the reaction in Oceania to the narrowing of the North American market was to divert supplies to Asian countries, particularly Japan, leading to lower prices there. At the same time, prices of beef from FMD areas were under downward pressure owing to competition from EC exports reflecting the level of export refunds. The EC stocks of intervention beef were notably reduced as inflow was considerably cut back by the imposition of more restrictive conditions on intervention buying in 1993.

No change in bovine meat production was forecast for 1994 with increases in North America, the EC and the Far East offsetting a contraction in most other regions, particularly in eastern Europe, countries of the former USSR and Oceania. World imports of bovine meat were expected to remain close to the reduced level of 1993. The restrictions on shipments to Canada and the United States were anticipated to continue. However, the ensuing decline in imports could be offset by larger purchases by Japan and the Republic of Korea, which recently raised its beef minimum import quota. On the export side, shipments from Australia were likely to fall as herd rebuilding was expected to reduce export availabilities. By contrast, sales by the United States and Latin American countries were forecast to rise. EC exports could also increase as production recovered and especially were restrictions on intervention purchases to be maintained. A continuation of restrictive import policies was expected to affect the international market in 1994. However, unlike 1993, record beef output in North America was anticipated to depress prices of exports to this market and limit the impact of reduced access to the region in 1994. At the same time, larger exportable supplies in FMD-free areas could also result in lower prices to Asia. Prices of beef from non FMD-free areas also could fall, particularly should the EC raise export in an attempt to prevent stocks increasing.

Sheepmeat

A small decline in world sheep and goat meat production was estimated for 1993. There was a sharp contraction in Oceania: in Australia, as a consequence of the flock reduction which has paralleled the fall in wool prices since 1989; and in New Zealand, reflecting the retention of lambs for flock expansion, Production also fell in the EC where downward pressure on prices was such that aids to private storage were granted. Continued depletion of flocks in countries of the former USSR again resulted in reduced output. In Africa, production was reduced by a decline in breeding flock numbers. In contrast, the removal of interprovincial trade controls in China fostered production, particularly as mutton was reported to be sold at a Premium in major cities.

Smaller availabilities of sheepmeat for export from Oceania in 1993 brought about a contraction in global trade. In the Near East enlarged imports of bovine meat and live cattle at attractive prices affected trade in sheepmeat, depressing volumes and prices. EC imports, the bulk of which is limited under a VERA with New Zealand, remained largely unchanged. The VERA, and reduced production in the EC increased prices in this trade.

Sheepmeat production was forecast to rebound mainly owing to an expected recovery in Australia and New Zealand and continued growth in the Far East. International trade in sheepmeat was likely to change little in 1994, although exports from Oceania were forecast to be slightly higher than in the previous year. Reduced production in the EC and the VERA with New Zealand could again trigger increases in prices to the Community.

Producer prices

¹ Live-weight prices converted into slaughter weight using standard conversion factors.
² Wholesale, Linier market.
³ Wholesale.
⁴ Choice 1000-1100 lb, Omaha.
⁵ Under 23 kg, Ballarat saleyard.
⁶ Market price.
⁷ Wholesale, Tokyo.
⁸ All weights, Omaha.
⁹ Average price for 1.2 kg, 1.3 kg and 1.5 kg birds, at farm.

Livestock numbers

¹ Census data generally refer to the beginning of the year indicated.

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