Live cattle - and beef meat - markets in the Mediterranean

Live cattle ‐ and beef meat ‐ markets in the Mediterranean basin
Philippe CHOTTEAU
Head of Economic Dept., IDELE
Cournon, 8 October 2015
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
More volatile markets than ever
Price wars over oil, which have repercussions on all commodities and import demand
Monetary wars Civil wars in the Middle East and arrival of refugees.
Major climatic events that affect the availabilities in the USA, Australia and elsewhere (El Niño, etc)
Economic slowdown in emerging countries...
… and large increase in beef demand
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
The challenge of forecasts: : History of the price of Brent oil barrel, in $
Terminal market price
Confidence interval of 86%
www.idele.fr
Confidence interval of 68%
Confidence interval of 95%
SOMMET DE L’ELEVAGE – 8 octobre 2015
The challenge of forecasts !
: Forecast of the price of Brent oil barrel, in $
Terminal market price
Confidence interval of 86% www.idele.fr
Confidence interval of 68%
Confidence interval of 95%
SOMMET DE L’ELEVAGE – 8 octobre 2015
A contagious volatility
Energy
Metals
Source: IMF
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
A growing correlation between prices of grain in EU and oil price
Source: GEB‐Institut de l’Elevage as per miscellaneous sources
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
€ devalued/US$, but not /Brazilian Real or /Turkish Lira Exchange rates in major currencies against the euro (base 100 in 2009)
150
140
Dévaluation €
130
Yuan chinois
Dollar des Etats‐Unis
Dollar australien
Rouble russe
Réal brésilien
Roupie indienne
120
110
100
90
80
Devaluation of currencies/€
70
60
50
Source : GEB‐Institut de l'Elevage, d'après Banque de France
janv.‐09
www.idele.fr
janv.‐10
janv.‐11
janv.‐12
janv.‐13
janv.‐14
SOMMET DE L’ELEVAGE – 8 octobre 2015
janv.‐15
Effect of exchange rates in Brazil:
Highest prices in Real, but falling back in €
Beef cattle price at the entry of the Sao Paolo slaughterhouse
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Syria: 4 million refugees outside
1 Syrian out of 5 has left his country www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Soaring prices in the USA and Australia
Price of production of live male cattle « ready to slaughter » (in US$/kg of carcass) www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Beef prices taking off in Turkey
Price of beef carcasses coming out of slaughterhouses in Turkey
Imports are
banned
www.idele.fr
Opening up to meat imports and then cattle
imports
New importing restrictions
SOMMET DE L’ELEVAGE – 8 octobre 2015
Large increase in beef demand
Beef meat consumption around the world Millions of Tons of carcasses
World Developing
countries Developed
countries Trend forecasts 2023/2013
North Africa
Sub‐Saharan Africa Latin America
Asia
+12% +207
+34% +1 662
+14% +2 020
+25% +4 091
Need for an additional 5 countries like France!
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Changes in Mediterranean markets for live cattle and beef
Two distinctive areas: North (EU)/South and East of the Mediterranean area
Reversed dynamics:
A mature market in the North which has been eroding since the economic and financial crisis was triggered (Greece, Italy and Spain are among the most affected countries!)
A fully‐expanding market in the South and East of the Mediterranean area
Less competition in EU:
The major world exporters have a strong presence in the South and East (Brazil, India, Australia, etc.)
Third‐world suppliers remain marginal in the countries to the North of the area.
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Consumption eroded in the North of the Basin
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Long‐term trends in imports in the Mediterranean Area
Comparisons from two distinct sources:
EUROSTAT in EU, by taking customs in importing countries (sources do not agree between supplier and customer customs)
Multiple sources for the third countries: Trade Map, Eurostat, Lebanese customs, Sagpya, Turkstat. Reference years:
2006: first year AFTER the abolition of returns on live cattle and BEFORE the blue tongue disease and the start of the economic and financial crisis.
2013 et 2014: the most recent available.
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Imports of beef and live adult bovine animals in the North Area in 2006
« Téc » = Tons of carcasses
« Têtes » = head of cattle
Origin of the imports Others
Live cattle
Live cattle
Beef meat
Live cattle
Beef meat
Source: Dpt Economie‐Institut de l'Elevage after Eurostat.
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Beef meat
Imports of beef and live adult bovine animals in the North Area in 2013
« Téc » = Tons of carcasses
« Têtes » = head of cattle
Origin of the imports Others
Live cattle
Live cattle
Beef meat
Live cattle
Beef meat
Source: Dpt Economie‐Institut de l'Elevage after Eurostat.
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Beef meat
Imports of beef and live adult bovine animals in the North Area in 2014: no major change/2013
« Téc » = Tons of carcasses
« Têtes » = head of cattle
Live cattle
Origin of the imports Others
Live cattle
Beef meat
Live cattle
Beef meat
Source: Dpt Economie‐Institut de l'Elevage after Eurostat.
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Beef meat
Imports of live adult bovine animals in the
South and East of the Area in 2006
« Téc » = Tons of carcasses
« Têtes » = head of cattle
Origin of the imports www.idele.fr
Source: Dpt Economie‐Institut de l'Elevage after TradeMap, Eurostat, lebanese customs, Sagpya, Turkstat. SOMMET DE L’ELEVAGE – 8 octobre 2015
Imports of live adult bovine animals in the South and East of the Area in 2013
« Téc » = Tons of carcasses
« Têtes » = head of cattle
Origin of the imports www.idele.fr
Source: Dpt Economie‐Institut de l'Elevage after TradeMap, Eurostat, lebanese customs, Sagpya, Turkstat. SOMMET DE L’ELEVAGE – 8 octobre 2015
Imports of live adult bovine animals in the South and East of the Area in 2014
« Téc » = Tons of carcasses
« Têtes » = head of cattle
Origin of the imports www.idele.fr
Source: Dpt Economie‐Institut de l'Elevage after TradeMap, Eurostat, lebanese customs, Sagpya, Turkstat. SOMMET DE L’ELEVAGE – 8 octobre 2015
EU exports of live cattle over 7 months
+52%
Source : EU‐Directorate‐General for Agriculture and Rural Development
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
EU exports of live cattle over 7 months
+60%
Source : EU‐Directorate‐General for Agriculture and Rural Development
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
France: upsurge in young cattle exports over 7 months 2015/14
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
France: young cattle exported to the South and East Mediterranean ‐ 7 months 2015
Exports 1st half 2014
•
•
•
www.idele.fr
Algeria: 11,300 animals (+17%/2013)
Tunisia: 1,226 animals (+76%/2013)
Morocco: 600 animals (+62%/2013)
SOMMET DE L’ELEVAGE – 8 octobre 2015
Imports of beef in the South and East of the Area in 2006
« Téc » = Tons of carcasses
« Têtes » = head of cattle
Origin of the imports www.idele.fr
Source: Dpt Economie‐Institut de l'Elevage after TradeMap, Eurostat, lebanese customs, Sagpya, Turkstat. SOMMET DE L’ELEVAGE – 8 octobre 2015
Imports of beef in the South and East of the Area in 2013
« Téc » = Tons of carcasses
« Têtes » = head of cattle
Origin of the imports www.idele.fr
Source: Dpt Economie‐Institut de l'Elevage after TradeMap, Eurostat, lebanese customs, Sagpya, Turkstat. SOMMET DE L’ELEVAGE – 8 octobre 2015
Imports of beef in the South and East of the Area in 2014
« Téc » = Tons of carcasses
« Têtes » = head of cattle
Source: Dpt Economie‐Institut de l'Elevage after TradeMap, Eurostat, lebanese customs, Sagpya, Turkstat. Origin of the imports 2014/06 export trend ‐ France:
to Tunisia and Algeria
to Morocco
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Conclusions
Very high demand for live cattle towards the South and East of the Mediterranean following the dynamic of
consumption, including the taste for beef offals. Diversification of live cattle suppliers, huge sensitivity/exchange rate and health issues.
Virtual duopoly (India, Brazil) for low‐cost frozen beef in the South of the Basin
and developing markets for fresh meat for grilling, where European suppliers are well positioned.
Expanding market in the South and East for live cattle and European suppliers, especially animals for fattening. www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015
Thank you for your attention!
more info:
Philippe.chotteau@idele.fr
www.idele.fr
SOMMET DE L’ELEVAGE – 8 octobre 2015