Claus Deblitz Dr. Claus Deblitz Turin, Italy 11.06.2014 Latest developments in global meat markets Thünen Institute of Farm Economics
Claus Deblitz
Dr. Claus Deblitz
Turin, Italy 11.06.2014
Latest developments in global meat markets
Thünen Institute of Farm Economics
Claus Deblitz
Content
1. agri benchmark
2. Consumption and production
3. Trade
4. Prices and their developments
5. Farm level results
6. Free trade (TTIP) between the US and the EU
11.06.2014 Latest developments in global meat markets Page 2
Claus Deblitz
The project behind the data and the people
Claus Deblitz
agri benchmark – understanding agriculture worldwide
11.06.2014 Latest developments in global meat markets Page 4
Claus Deblitz
Target groups and relevance
11.06.2014 Latest developments in global meat markets Page 5
• Address global challenges with global overview and systematic expertise locally
Non-profit organisations
• Align future production through benchmarking and positioning
Producers and their organisations
• Operate successfully through in-depth understanding of markets and customers
(Agri)Businesses
Claus Deblitz
Participating countries 2014
Contacts for further growth
Countries in the agri benchmark Network
11.06.2014 Page 6
Latest developments in global meat markets
New countries 2014 Paraguay (beef) Botswana (beef)
2014 Countries Farms
Cow-calf 25 58
Beef finishing 31 76
Sheep 18 35
Claus Deblitz
agri benchmark – the main elements
11.06.2014 Latest developments in global meat markets Page 7
Network
Product branches
Data
Confe-rences
Capacity building
Know-how
Analysis and
projects
Coordination Main supporting partner
Clients
Claus Deblitz
Our research partners
11.06.2014 Latest developments in global meat markets Page 8
http://www.lamolina.edu.pe/portada/http://www.cna.org.br/http://www.cepea.esalq.usp.br/english/http://www.agro.uba.ar/trad/english/index.shtmlhttp://www.afpc.tamu.edu/http://www.crpa.it/home/en/index.asphttp://www.argerind.at/
Claus Deblitz
Consumption and production
Claus Deblitz
Total meat consumption 2012 (1000 tonnes)
11.06.2014 Latest developments in global meat markets
Page 10
Source: FAOStat 2013
Claus Deblitz
Change of per capita consumption of beef 2010-2012 vs. 2000-2002 (kg per capita and year)
11.06.2014 Seite 11
Source: agri benchmark, national statistics
Latest developments in global meat markets
0
10
20
30
40
50
60
70
UY AR AU US FR IT AT ES UA PL
'00-'02
'10-'12
0
10
20
30
40
50
60
70
BR IE UK RU ZA DE CN
'00-'02
'10-'12
Decrease Increase
+4% +9%
+13%
+18% +6%
+8% +8%
-55% -32%
-5%
-14%
Claus Deblitz
Change in beef consumption: a mixed situation - 1000 tonnes 2010 - 2012 vs. 2002-2004
11.06.2014 Latest developments in global meat markets
Page 12
Source: FAOStat 2013
Claus Deblitz
China, Asia and Africa drive sheep meat consumption - change 1000 tonnes 2010 - 2012 vs. 2002 - 2004
11.06.2014 Latest developments in global meat markets
Page 13
Source: FAOStat 2013
Claus Deblitz
And the winner of meat consumption is: poultry! - change (1000 tonnes) 2002 - 2004 vs. 2010 - 2012
11.06.2014 Latest developments in global meat markets
Page 14
Source: FAOStat 2013
Claus Deblitz
20
13
20
14
20
15
20
16
20
17
20
18
20
19
20
20
20
21
20
22
OECD / FAO global meat production projections
11.06.2014 Page 15
Latest developments in global meat markets
million tonnes
0
20
40
60
80
100
120
140
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
Beef and veal Pigmeat Poultry meat Sheepmeat
Source: OECD / FAO Agricultural Outlook 2013-2022
Claus Deblitz
US remains biggest beef producer in 2012 (‘000 t)
11.06.2014 Latest developments in global meat markets Page 16
Data for Sudan at FAOStat 2014 where change, value (1,000 t) for 2010 = 343, value for 2011 = 345., value for 2012 = 358
Source: FAOStat 2014
Claus Deblitz
Brazil and China driving beef production (‘000 t) - change 2010-2012 vs. 2000-2002
11.06.2014 Latest developments in global meat markets Page 17
Source: FAOStat 2014, own calculations
Claus Deblitz
China dominates sheep production and expansion (‘000 t) - change 2010-2012 vs. 2000-2002
Latest developments in global meat markets Page 18
Source: FAOStat 2014, own calculations
11.06.2014
Claus Deblitz
Aquaculture overtook beef in 2012
Source: Earth Policy Institute based on FAO / USDA
11.06.2014 Latest developments in global meat markets Page 19
0
10
20
30
40
50
60
70
Aquaculture
Beef
million tonnes
Claus Deblitz
Trade
380
200
159
194
384
303
328
146
448
214
Claus Deblitz
Beef export volumes (‘000 t) ≠ export shares (export in % of production) – average 2010-2012
11.06.2014 Latest developments in global meat markets Page 21
0% 20% 40% 60% 80% 100%
0 500 1.000 1.500 2.000
BrazilAustralia
USAIndia
GermanyIrelandFrancePoland
UruguayArgentinaParaguay
UKItaly
ChinaSpain
AustriaMexico
NamibiaBotswana
Tausende
Exports '000 t
Export share %
Source: FAOStat, UNComtrade, PSD/FAS/USDA
Claus Deblitz
Beef import volumes (‘000 t) ≠ import shares (import in % of production) – average 2010-2012
11.06.2014 Latest developments in global meat markets Page 22
0% 50% 100% 150% 200% 250% 300%
0 100 200 300 400 500 600 700 800
RussiaUSA
JapanEgypt
ItalyChina
FranceSouth Korea
GermanyUK
MexicoSpain
S. ArabiaIndonesia
ChileSwedenAustria
Tausende
Imports '000 t
Import share %
Source: FAOStat, UNComtrade, PSD/FAS/USDA
Claus Deblitz
Beef trade balances (exports - imports) (‘000 t) – average 2010-2012
11.06.2014 Latest developments in global meat markets Page 23
-1.000 -500 0 500 1.000 1.500 2.000
BrazilAustralia
IndiaIreland
USAPoland
UruguayArgentinaParaguayGermany
BelarusS. Arabia
UKMexico
ChinaItaly
South KoreaEgyptJapan
Russia
Tausende
Source: FAOStat, UNComtrade, PSD/FAS/USDA
Claus Deblitz
Self-sufficiency of beef – average 2010-2012
11.06.2014 Latest developments in global meat markets Page 24
0% 100% 200% 300% 400% 500% 600%
S. ArabiaSouth Korea
JapanEgypt
SwedenRussia
ChileItaly
IndonesiaCzech R.
UKGermany
BrazilAustriaBelarus
BotswanaUruguay
ParaguayAustralia
PolandNamibia
IrelandIndia
Source: FAOStat, UNComtrade, PSD/FAS/USDA
Self-sufficiency
Production Production – exports + imports
Claus Deblitz
Top 10 beef trade flows 2012 (‘000 tons)
11.06.2014 Latest developments in global meat markets Page 25
345
167
235
171 196
160
IE > UK 190
169
Source: UNComtrade 2014
IN > VN 294
254
Claus Deblitz
Top 10 sheep trade flows 2012 (‘000 tons)
11.06.2014 Latest developments in global meat markets Page 26
77
47
22
25
21
88
26 25
83 45
Source: UNComtrade 2014
68
Claus Deblitz
Prices
Claus Deblitz
FAO global meat price index
11.06.2014 Page 28
Latest developments in global meat markets
Index based on USD per ton prices
0
50
100
150
200
250
300
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Meat Price Index
Poultry Meat
Pig Meat
Bovine Meat
Ovine Meat
Source: FAO Meat price index
Claus Deblitz
OECD / FAO global meat price projections
11.06.2014 Page 29
Source: OECD / FAO Agricultural Outlook 2013-2022
Latest developments in global meat markets
USD per ton
0
1000
2000
3000
4000
5000
6000
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
Beef and veal Pigmeat Poultry meat Sheepmeat
20
13
20
14
20
15
20
16
20
17
20
18
20
19
20
20
20
21
20
22
Claus Deblitz
Beef prices rising (1997, 2005 and 2013)
11.06.2014 Page 30
Latest developments in global meat markets
Less than USD 5.00 per kg CW in 2013 USD 5.00 and higher per kg CW in 2013
0123456789
101112
Nam
ibia
Bra
zil
S. A
fric
a
Au
stra
lia
Ukr
ain
e
Arg
enti
na
Uru
guay
Po
lan
d
Can
ada
Cze
ch R
.
Ru
ssia
USA
'97 '05 '13
0123456789
1011
Ger
man
y
Au
stri
a
Sp
ain
Fra
nce
Sw
eden
Irel
and
UK
Ch
ina
Ital
y
Ind
on
esia
Tu
nis
ia
'97 '05 '13
Source: agri benchmark, national statistics
Claus Deblitz
Plant products with higher increase and more volatile than beef
11.06.2014 Latest developments in global meat markets Page 31
Index year 2000 = 100
0
50
100
150
200
250
300
350
400
450
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
Average beef Average corn Average wheat Average soybean
Source: FAO Price data base http://www.fao.org/economic/est/prices
http://www.fao.org/economic/est/priceshttp://www.fao.org/economic/est/priceshttp://www.fao.org/economic/est/prices
Claus Deblitz
Farm level results
Claus Deblitz
Production systems in beef finishing
11.06.2014 Page 33
Feed % in
> 30%
> 30%
> 50% grains
> 30%
dry matter
pasture
silage and
and other
freshly cut grass
other forages
energy feed
& other vegetation
Management/
Outdoor
Closed or semi-
Confined, large,
Mix of pens and
Housing
year round or
open barns with
open pens,
grazing of paths
part of the year
slatted floors
partially with
and paddies
and/or straw bedding
sun-covers
Extent of
Low
Medium
High
Low
purchase feed
Pasture
Silage
Feedlot
Cut & Carry
Latest developments in global meat markets
Claus Deblitz
Daily weight gain and net gain by production system (net gain = carcass weight divided by age at slaughter)
g per day
11.06.2014 Page 34
0
200
400
600
800
1000
1200
1400
1600
1800
2000
ID-4
ID-2
CN
-94
0C
N-2
00
0A
R-6
30
ES-4
30
MX
-15
00
ES-5
20
ES-5
50
0A
R-2
6K
US-
72
00
PE-
17
00
CA
-28
KZA
-75
KB
W-2
00
0U
S-7
5K
ZA-3
00
0N
A-2
5K
BR
-15
50
AU
-15
K
BR
-34
0U
Y-7
5N
A-6
00
AU
-32
0B
R-6
00
BR
-54
0A
U-1
50
BR
-60
0B
BR
-50
AU
-37
5A
U-4
15
CO
-35
0C
O-1
30
CO
-16
0ID
-10
0A
R-3
80
AR
-80
0A
U-8
5IE
-40
UK
-80
NZ-
37
5A
U-5
40
UA
-27
5
KZ-
80
0U
K-4
5U
K-9
0P
L-3
0C
Z-5
00
PL-
20
UK
-75
0D
E-2
85
UA
-56
00
SE-2
30
CO
-80
0D
E-8
00
RU
-64
0D
E-2
80
FR-7
0C
N-3
00
CN
-15
0M
A-2
80
DE-
26
0D
E-5
25
TA
T-3
5A
T-2
5F
AT-
12
0TN
-45
CN
-70
FR-2
00
AT-
17
5T
IT-9
10
SE-1
00
IT-2
66
0T
FR-6
0SE
-15
0
Daily weight gain (g per day)
Net gain (g per day)
Pasture
Feedlot
Silage
Cu
t &
Cu
rry
Latest developments in global meat markets
Claus Deblitz
0
100
200
300
400
500
600
700
800
900
'05 '07 '09 '11 '13
South Africa
Australia
Austria
Spain
Germany
UK
Italy
France
Cost developments in beef production 2005-2013
11.06.2014 Page 35
Latest developments in global meat markets
USD per 100 kg carcass weight and increase in percent
'05 '07 '09 '11 '13
USA
Argentina
Poland
Argentina
Brazil
China
110 %
130 %
150 %
290 %
Claus Deblitz
Margin over cash costs (2005-2013)
11.06.2014 Page 36
USD per 100 kg carcass weight
0
100
200
300
400
500
600
700
800
900
1000
IT-2660T
FR-70 DE-280
ES-5500
US-7200
CN-940
AR-380
BR-600
Returns
Cash costs
Latest developments in global meat markets
Claus Deblitz
0
200
400
600
800
1000
1200
AT-
25
FA
T-3
5A
T-1
20
AT-
17
5T
DE-
26
0D
E-2
80
DE-
28
5D
E-5
25
TD
E-8
00
FR-6
0FR
-70
FR-2
00
ES-4
30
ES-5
20
ES-5
50
0IT
-91
0IT
-26
60
TU
K-4
5U
K-8
0U
K-9
0U
K-7
50
IE-4
0SE
-10
0SE
-15
0SE
-23
0P
L-2
0P
L-3
0C
Z-5
00
UA
-27
5U
A-5
60
0R
U-6
40
CA
-28
KU
S-7
20
0U
S-7
5K
MX
-A
R-3
80
AR
-63
0A
R-8
00
AR
-26
KU
Y-7
5B
R-5
0B
R-3
40
BR
-54
0B
R-6
00
BR
-60
0B
BR
-15
50
CO
-13
0C
O-1
60
CO
-35
0C
O-8
00
PE-
17
00
CN
-70
CN
-30
0C
N-9
40
CN
-20
00
CN
-15
0ID
-2ID
-4ID
-10
0K
Z-8
00
AU
-85
AU
-15
0A
U-3
20
AU
-37
5A
U-4
15
AU
-54
0A
U-1
5K
NZ-
37
5M
A-2
80
TN-4
5ZA
-30
00
ZA-7
5K
NA
-60
0N
A-2
5K
BW
-
Opportunity costs
Cost from profit and loss account
Total returns
Mid-term profitable, long-term not (2013)
11.06.2014 Page 38
Latest developments in global meat markets
USD per 100 kg carcass weight
Europe Asia, Oceania
Americas
Africa
Claus Deblitz
0%
50%
100%
150%
200%
250%
AT-
25
FA
T-3
5A
T-1
20
AT-
17
5T
DE-
26
0D
E-2
80
DE-
28
5D
E-5
25
TD
E-8
00
FR-6
0FR
-70
FR-2
00
ES-4
30
ES-5
20
ES-5
50
0IT
-91
0IT
-26
60
TU
K-4
5U
K-8
0U
K-9
0U
K-7
50
IE-4
0SE
-10
0SE
-15
0SE
-23
0P
L-2
0P
L-3
0C
Z-5
00
UA
-27
5U
A-5
60
0R
U-6
40
CA
-28
KU
S-7
20
0U
S-7
5K
MX
-A
R-3
80
AR
-63
0A
R-8
00
AR
-26
KU
Y-7
5B
R-5
0B
R-3
40
BR
-54
0B
R-6
00
BR
-60
0B
BR
-15
50
CO
-13
0C
O-1
60
CO
-35
0C
O-8
00
PE-
17
00
CN
-70
CN
-30
0C
N-9
40
CN
-20
00
CN
-15
0ID
-2ID
-4ID
-10
0K
Z-8
00
AU
-85
AU
-15
0A
U-3
20
AU
-37
5A
U-4
15
AU
-54
0A
U-1
5K
NZ-
37
5M
A-2
80
TN-4
5ZA
-30
00
ZA-7
5K
NA
-60
0N
A-2
5K
% of opportunity cost in returns % of P&L cost in returns
Slightly better situation on whole-farm level
11.06.2014 Page 39
Percentage of costs in total returns
Europe
Asia, Oceania Americas Africa
Latest developments in global meat markets
Claus Deblitz
Free trade (TTIP) between the US and the EU
Claus Deblitz
The use of hormones and beta-agonists in the US is common practice
11.06.2014 Page 41
11,9
42,1
5,5
78,7
47,5
56,2
20,4
84,4
57,4
0
10
20
30
40
50
60
70
80
90
100
Hormones Hormones Beta-agonists Hormones Beta-agonists
Cow-calf (2008) Feedlots < 1000 capacity Feedlots > 1000 capacity
% farms / feedlots % cattle
Latest developments in global meat markets
75% of feeder cattle receive hormones 50% of feeder cattle receive beta-agonists
Claus Deblitz
The use of hormones and beta-agonists increases productivity and carcass yields
11.06.2014 Page 42
USD per 100 kg LW
Latest developments in global meat markets
Feedlot USA 75 000 sold
Unit With hormones Beta-agonists
w/o hormones Beta-agonists
Percentage change
Lower feed conversion rates
Kg feed
5.9 6.9 - 15 %
Higher daily weight gain
g per day
1 650 1 350 +22 %
Higher final live weight
Kg 580 540 + 7 %
Higher carcass yield
% 64.1 62.5 + 3 %
Higher carcass weight
Kg 370 335 + 9 %
Claus Deblitz
The increased performance results in a cost advantage of approximately 10 percent
11.06.2014 Page 43
0
50
100
150
200
250
300
350
400
450
500
Beef returns Total cost Purchase feed Vet/med Other costs
w/o hormones / beta agonists
With hormones
With hormones / beta-agonists
USD per 100 kg CW
Latest developments in global meat markets
Claus Deblitz
Reflecting transpost costs and the non-use of growth promoters brings US-cosrts close to EU price level
11.06.2014 Page 44
US 1) Total costs in 2012 (with growth promoters)
US 2) = 1) + Transport cost Nebraska - Hamburg
US 3) = 2) + Additional cost without growth promoters
0
100
200
300
400
500
600U
S 1)
US
2)
US
3)
PL-
30
DE
-285
CZ-
50
0
ES-
550
0
ES-
490
UK-
90
FR-2
00
DE
-280
FR-6
0
AT-
35
AT-
12
0
FR-7
0
IT-9
10
SE-1
50
SE-2
30
Additional costs w/o growth promoters)
Transport Nebraska - Hamburg
Costs in 2012 (with growth promoters)
Beef price in 2012
US-75KUSD per 100 kg CW
Latest developments in global meat markets
Claus Deblitz
Summary
11.06.2014 Page 45
Latest developments in global meat markets
China, Asia, Africa and South America (Argentina) drive consumption
China and Brazil drive beef production
Rally of beef and livestock prices slowed down
The world is getting closer in prices and costs of beef production
Beef production is short- to mid-term profitable, long-term not
Changes of CAP-reform leads to income losses
Free trade EU-US not expected to have negative impacts on EU-beef production
Claus Deblitz
agri benchmark – passionate about facts
11.06.2014 Page 46
Dr. Claus Deblitz Thünen Institute of Farm Economics Bundesallee 50 38116 Braunschweig, Germany
Latest developments in global meat markets
Tel.: +49-531-596-5141 Fax: +49-531-596-5199 E-mail: [email protected] Internet: www.agribenchmark.org www.ti.bund.de/bw