MEAT INDUSTRY IS “WEATHERING THE STORM”

MEAT INDUSTRY IS “WEATHERING THE STORM”

Meat production in Russia continues its growth but the pace of growth is slowing down. Thus, according to the results of two quarters in the year 2015 in all categories of farms was 517 thousand tonnes of beef (- 4.9% to the period of 2014), 879 thousand tonnes of pork (+ 2% to the period of 2014) and 1.43 million tonnes of poultry meat (+ 4.8% to the period of 2014) live weight. Thus, in relation to the first quarter of current year, the production growth occurred only in the poultry sector – only 1 %, whereas the beef production declined by 8 %, and pork – by 0.6 %. These indicators are noticeably lower than the comparable figures from 2013 or 2014. This  fact indirectly confirms the meat industry performance in conditions of a falling market and citizens’ reduced Income, which reflects the reduced production capacity. Based on the current statistics, IKAR (The Institute for Agricultural Market Studies) concludes that in the second quarter, the production sites in meat industry were underutilized in order to avoid the effect of a serious overproduction and falling prices in meat market.

Nevertheless, meat manufacture will continue to increase together with the process of Russian economy restoration, the growth of real population income and the consumer capacity. This process will put pressure upon the domestic meat prices over longer period of time. As a result, meat branch trends of the world market will become characteristic for the Russian market. Under the influence of various groups of factors including the growth of meat manufacture, meat price has been decreasing since August 2014, when it was the peak of its growth. To date, the ratio of meat price, the demand of the population and the level of production in Russia can be called optimally balanced as we consider the current trends in food market.

Source: www.meatinfo.ru