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The WHO's imprudence or the last drop

The European market is saturated with pork since late summer. The WHO's report has been an ice-cold shower for the whole of the European pig sector.

Monday 2 November 2015 (2 years 10 months 19 days ago)
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A few days ago, the WHO published a not very rigorous report telling that processed meats and non-processed red meats are carcinogenic in a higher or lower degree. Three days later, the same organization has been forced to explain the details of its conclusions. Meanwhile, renowned doctors and food technicians have been of the opinion that the WHO's initial report was not very rigorous and very daring, to say the least.

The European market is saturated with pork since late summer. The WHO's report has been an ice-cold shower for the whole of the European pig sector. Consciously or unconsciously, the damage is already done. It is a low blow.

This late October we can confirm two facts: the prices in Spain have been falling for 12 consecutive weeks (a total accumulated value of €0.227/kg LW), and the average carcass weight increases week by week without stop, with a rise by more than 5 kg per pig in the last 8 weeks.

The abattoirs slaughter at a good pace, but the fluidity of the slaughterings is not enough to absorb the enormous current supply. In the 90's, in a similar situation, the price would have crashed reaching a level low enough to allow the export of carcasses. In this way, the seasonal excess supply was eliminated drastically and the price found a floor from where to bounce back. This happens no more, and the drop in price step by step and reluctantly is not being enough to stimulate record slaughterings that are undoubtedly necessary to reestablish the balance between supply and demand.

The recent formalization of the TPP (Trans-Pacific Partnership) will favour the trade of USA with Japan, at the expense of the EU: another bad piece of news, although not for the near future.

With losses in production already present since some weeks ago (prices below cost), with all Europe saturated, and with the meat prices clearly falling it is very difficult to feel optimistic. The storm has not finished yet and we will have to see how much the prices will fall until finding a stable floor.

We are in a crisis without an unknown reach. Big problems require big solutions, so the EU should bring in market support measures and help to find, at any rate, new world markets for pork. Diplomacy should make itself available to meat and work its heart out.

As the Argentinian writer Julio Cortázar said: “Hope belongs to life. It is life itself defending itself.”

Guillem Burset

Guillem Burset

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