Pork will become more expensive: Ukraine tipped the rise of prices and the massive bankruptcy of pig farms

In 2017 prices is the type of meat – pork – can be much larger, although the price increase is already noticeable with the naked eye, writes UBR.

The popularity of pork increased last year due to lower prices and simultaneous rise in price of poultry – consumption of pig meat increased by 7%. As of February 1, 2017, the Fund of consumption of pork and meat products from it amounted to 100 thousand tons, poultry — 95 kt, reported by the Association “the Pig producers of Ukraine”.

The production of chicken meat in Ukraine is still growing, but the pork falls.

Active export of chicken has reduced its supply in the domestic market and contributed to keeping prices. Pork, on the contrary, almost not exported from the country, and prices fell.

However, since the beginning of February, pork prices have risen by 15%. We are talking about products of the highest category, which in live weight are purchased from manufacturers for 37 UAH/kg. processed Products are becoming more expensive slower. For example, eaves side from the manufacturers are sold for 64 UAH/kg, which is 12% more than three weeks ago.

Experts explain price rise by abolition of the special regimes of VAT, raising the minimum wage and other rising costs, particularly for feed and fuel. But the most dangerous and unpredictable factor in the impact on prices remains complex epizootic situation from-for flashes of the African plague of pigs (Achs), which, in fact, undermined our exports.

Since the beginning of February, pork prices have risen by 15%.

“Processors and manufacturers say that now our product is, even the sausage, it was very difficult to sell in foreign markets. New clients appear, and old ones are gradually abandoning meat products from the country where mass recorded cases of ASF,” said the Director of the Ukrainian Association of trade networks suppliers Oleksiy Doroshenko.

But the reduction of export will not be able to keep the prices down, because the supply on the domestic market will also decrease.

Expensive disease

According to the Association of “the pig Breeders of Ukraine”, at the beginning of February 2017 , the number of pigs in the country decreased by 7.1%compared to the previous year to 6.54 million head. And the breeders continue to cut the number. Just over a month, its numbers decreased by 2.2% or 145 thousand heads. Only four regions of Ukraine (Volyn, Lviv, Ivano-Frankivsk and Transcarpathian) managed to keep positive dynamics.

According to the estimates of EBRD experts, each destroyed because of the disease is ASF virus pig costs an average of 115 dollars, households, $ 200 — small and medium farms, and $ 460 is a large industrial complex. According to the head of Gospodarevskaya Volodymyr Lapa, only direct losses from Achs exceed 130 million UAH, and the total losses, which include a ban on conducting business within forty days after the outbreak, estimated at about 200 million UAH.

Vice-President of the Association “the Pig producers of Ukraine” Oksana Yurchenko said that the FAO experts have modeled the possible scenarios of development of the situation with ASF. According to forecasts, this year the Ukrainian industrial pig sector may lose from 18.2 thousand to 1.5 million heads (up to 40% of the population), and households from 900 to 71 thousand heads.

By mid-February 2017, there were 35 cases of outbreaks of ASF in 16 areas, the quarantine is in effect in 39 settlements. Over the past year, according to the Ukrainian agrarian Confederation, was recorded 91 cases of the disease against 40 cases in 2015. That is, the epidemic does not intend to retreat.

As a result, predicts the President of the Union of agricultural service cooperatives Ivan Tomic, two or three years the number of pigs reduced by one third, pork prices before the end of 2017 will rise by 25%.

President of the Association “the Pig producers of Ukraine” Artur Loza expects that a domestic product may become scarce and expensive, so the Ukrainians will again have the Polish, Brazilian and canadian pork instead of domestic.

According to him, in 2016 the profitability of production of pig products reached a five-year low that spurred the rise in pork prices. But to rewrite the price tags on your desired producers, how to buy an expensive product, most Ukrainians simply do not what. It is therefore possible wave of bankruptcies of farms.

Recorded 35 cases of outbreaks of ASF in 16 areas, the quarantine is in effect in 39 settlements. For two or three years the number of pigs reduced by one third, pork prices before the end of 2017 will rise by 25%.

According to Vines, the industry is looking for ways to maintain the export potential. One option is to work the pig farms in the closed mode. The corresponding proposal is contained in amendments to the current regulations, which have already prepared Rospotrebsoyuz.

If the idea of nurses to adopt the Cabinet, the systems will become “sensitive”, but for the market will benefit from this – the outbreak of ASF, for example, on the farm, will not indicate that pigs need to be beat in the neighborhood. Similarly, if the disease is found in pigs in the private backyard, a nearby farm will not suffer — it is assumed that the threat of the virus there should not get. That is, the destruction of the herd will be reduced.

In addition, Loza sees great opportunities in the Union producers that will allow them to reduce their costs. For example, large pig farms can, for example, pass the pigs for growing population etc.