At the end of this year, pork production in Russia planing increase by 7-8% or 260-270 thousand tons in slaughter weight. This forecast was given by the General Director of The National Union of pig breeders (NSS) Yuri Kovalev at the 11th international agricultural conference “where is the margin”, organized by the Institute of agricultural market conditions (ICAR). In 2019, the country received more than 3.9 million tons of pork in slaughter weight. The increase in the production of this type of meat in all farms was 5.1% and in industrial enterprises-7.2%.
“The last 10-12 years have been a very interesting time: huge investments have been made in Russian pig farming. All these years, the industry has seen good profitability of production, but now the period of intensive growth of the segment is gradually ending — ” the expert said. — We face a real risk of satiating the domestic market.” At the same time, Kovalev stressed, pig farming is still a significant, but perhaps the only driver of increasing the production of all types of meat in the country. In 2019, total production increased by 2.1% to 10.85 million tonnes in slaughter weight. At the same time, poultry farming added only 0.6%, beef cattle — 0.8%, and in the segments of lamb and other types of meat, there was a decline at all — by 4.3% and 0.5%, respectively and in 2020, pork meat production in Russia will add up to 270 thousand tons.
According to the experts, over the past five years, the consumption of pork due to lower prices has increased by more than 0.5 million tons, amounting to more than 3.9 million tons last year. 2018 has become a kind of border for the Russian pig industry. “From the number 1 importer of pork, which our country was back in 2012, in six years we have reached 100% self — sufficiency in this type of meat,” Kovalev said. — And in 2019, pork exports exceeded its imports for the first time, and Russia became a net exporter. This step is recognized as unprecedented by international experts of the meat market!”. According to a preliminary estimate of VAT, the import of pork last year amounted to 91 thousand tons, export-105 thousand tons.
The expert predicts that in 2020, due to the abolition of quotas for duty-free import of pork and the introduction of a duty of 25%, the reduction in imports will continue. At the end of the year, the indicator may fall by about 50% to 50 thousand tons.at the same time, pork exports continue to grow due to the opening of the Vietnam market. The increase for 2020 will be 15-20% and in 2020, pork meat production in Russia will add up to 270 thousand tons.
However, the success of production has a downside. Due to the sharp increase in supply, the average annual price for live pigs this year may lose another 8-10%, which will be the lowest since 2014 (about 90 rubles/kg with VAT) so in 2020, pork meat production in Russia will add up to 270 thousand tons. In this case, the average price for half-carcasses will be about 135 rubles/kg. the opening of the Chinese market could Support prices and activate the import of pork products, Kovalev noted. Work in this direction continues. “The planned wide opening of foreign markets for domestic pig products means the onset of a new period of direct fierce competition with world giants in the export of pork not only in the duty-protected domestic market of Russia but primarily in the markets of Southeast Asia,” the expert explained. — This should give an additional impetus to the need to improve the efficiency and competitiveness of the industry by all available methods – through reducing costs, working with genetics, feed, etc.”