VEGA News Item

Feed Prices Unsettling Europe’s Meat Industry - 08/03/2011

Dioxin Contaminations Depress Trade Too

"The Market for grass-fed beef and lamb is currently buoyant, with good prices achieved for all commodities. This is not the case for pigs and poultry, which suffer from a poor European market and very high feed prices." Thus begins a Global Outlook released in February 2011 by Jean-Pierre Garnier, Export Manager of BPEX and EBLEX (which comprise most of the responsibilities devolved from the Meat and Livestock Commission).

2. Price falls in Germany due to the dioxin problem have become a major setback for the meat industry. Only a month ago pig producers faced "not only worsening prices, but the potential of a market collapse as German consumption fell and many Third Countries closed their markets to Germany, the biggest exporter in the EU. For instance, contracts for thousands of Dutch and Danish weaners (young pigs) were cancelled.

3. The market managers at the Europe Commission have only one tool in their kit-the so-called Aids to Private Storage, which allows the EU to support taking pork off the market and freezing it for future resale - in this case on the more buoyant world markets. "The dioxin crisis provided the right circumstances where the measure could and should be used," states Jean-Pierre Garnier: "following its implementation, markets were stabilized and, a further, more damaging, collapse (was) avoided. The scheme should have opened earlier, but was delayed by the 'free market' principles now applied by the European Commission, bad memories of more interventionist times and budgetary considerations," he added, treading carefully thru concepts of free and managed markets and memories of butter mountains and, in Britain at least, in a rocky coalition government that has to cope with right-wing opponents, especially Tories, of the CAP and all its works.

4. Jean-Pierre Garnier tackles the problems, concluding that "there are 2 lessons to be learned. The modern, large-scale and highly productive European pork sector cannot switch production as easily as in the past and is more susceptible to market turbulence, particularly as price volatility of raw material and end products have risen. Secondly, there must be a link somewhere between feed prices and meat prices. As cereal, fats, protein, and sugar prices have all rocketed, meat prices - particularly for European pork - have remained stable. This is not sustainable and we must call for higher pork prices."

5. The commentary illustrates nicely the folly in ignoring the Grow Food, not Feed principle in European farming. In the live/deadstock sector British pig farmers, protesting welfare considerations such as castration, regarded as cruel practices perpetrated by Johnny Foreigner, in the pursuit of raised production without the pubertal embarrassments of foul boar taints.

Pfizer, producers of Viagra, have now in trials a clever way of immunizing pigs against the actions of their own hormones, thus inducing a period of suspended taint- free production and loss of efficiency in the feed to flesh conversion; the little piggy can therefore to market "entire" and heavier than British pigs that are slaughtered as unmodified and not subjected to a form of delayed puberty, without irreversible bodily cuts.


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