JEDDAH – “Dynamic import demand in the Middle East, especially Saudi Arabia, and China is expected to continue and should boost EU exports,” the European Commission said in its “Prospects for Agricultural Markets and Income in the EU 2013-2023” report. Poultry meat has partly made up for the reduced availability of beef. Thanks to short rearing times and the fact that it is relatively easy to invest in the sector, poultry meat production has maintained its recent steady upward trend, though at a slower rate than before. Again, higher feed costs and the economic environment had a significant impact, reflected in slower growth in 2011-13. In a context of growing world demand, EU exports grew substantially in 2010 (+24 percent) and 2011 (+12 percent). Nevertheless, respective export growth was much weaker in 2012 (+2 percent) and 2013 (+1 percent), as strong demand in some African countries (mainly South Africa and Benin) and the Middle East (Saudi Arabia) was offset by fewer shipments to Hong Kong and Russia. Lower export refunds in October 2012 and their complete removal in January 2013 for chicks and in July for frozen poultry carcasses seem not to have had a noticeable effect on exports. 2012 imports remained rather stable at around the same level as in the previous year, but increased by 3.4 percent in 2013 in response to firm growth in domestic consumption. Higher imports from Thailand (for which a quota for salted raw poultry meat was opened in July 2012) compensated for the shortage of supply from Brazil (a result of production constraints and exporters focusing more on Asian markets). Cautious spending in an uncertain economic environment saw consumption slowing down in 2011 and 2013 (unlike 2012, when consumption of other meat fell sharply). Per-capita consumption in both the EU-N13 and EU-15 is around 20 – 21 kg. The increase in poultry production is expected to be hindered by feed costs staying relatively high though below the record 2011 and 2012 levels. Poultry meat will remain the most dynamic meat and expand at a rate of 0.8 percent per year in 2012-23. By 2023, production is expected to reach 13.6 million tons. According to current projections, the dynamic import demand in the Middle East (especially Saudi Arabia) and China is expected to continue and should boost EU exports to 1.4 million tons in 2023 (15 percent above the 2010-12 average). Exports are expected to grow by 120 000 tons as compared to 2012, with greater demand also from South Africa and Ghana. On the other hand, projected production increases in Russia will lead to a contraction in import demand there. EU imports should fluctuate around the tariff rate quota level (-800 000 tons). Meanwhile, cow-milk output may rise to 157.3 million tons from 150.4 million tons, with most of the increase absorbed by cheese production, the European Commission said. Cheese making may climb to 10.7 million tons from 9.67 million tons, with exports advancing to 1.02 million tons from 806,000 tons in 2013. “It is expected that the cheese market will be buoyed by a dynamic world market and steady growth in domestic demand,” the EU wrote. The FAO's index of dairy prices averaged 242.9 points last year, the highest ever and up from 95.6 points in 2003. European Union production of foodstuffs from cheese to poultry to wheat is predicted to climb by 2023 on demand for exports and the manufacturing of biofuels from grains, the 28-nation bloc said. Annual grain output is seen climbing to 316.1 million metric tons in 2023 from 304.3 million tons in 2013, while total meat output is seen rising to 45.5 million tons from 43.7 million tons last year, the EU wrote in an online report. The EU's grain, meat and dairy industries are all expected to benefit from global demand, according to the report. The EU produces 20 percent of the world's wheat and pork and accounts for 30 percent of global cheese exports, based on data from the United Nations' Food & Agriculture Organization. “Agricultural commodity prices are expected to stay firm over the medium term, supported by factors such as the growth in global food demand, the development of the biofuel sector and a low productivity growth,” the European Commission wrote. The EU area growing arable crops is expected to remain stable at 57.8 million hectares (142.8 million acres), with an increase for soft wheat, corn and rapeseed at the expense of barley and durum wheat, according to the report. Soft-wheat planting may rise to 24 million hectares by 2023 from 23.3 million hectares last year. Grain consumption is predicted to climb to 297.9 million tons in a decade from 279.8 million tons in 2013, led by a doubling in use of cereals to make fuel to 20.6 million tons from 10.1 million tons. EU grain exports are seen climbing to 31.1 million tons from 27.4 million tons. – SG
