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Brussels, 22 May 2001
Beef market situation: Update on 18 May 2001
Agriculture Commissioner Franz Fischler believes the EU beef market shows signs of recovery. Compared to the pre-crisis situation, the latest estimates show a drop in beef consumption of 10% (compared to 18% last month). Also the price reduction has become less severe. Furthermore, some third countries such as Russia reopened their market for EU beef. "This is partly the result of the measures we put in place. During the first four months of this year, about 475,000 tons of beef have been withdrawn from the market, of which about 200,000 tons are now stored in public intervention. We should however not forget that a considerable number of animals, mainly cows, are still being held back on farms, that consumption is still down and that a significant part of our export markets are still blocked. This means that the intervention stocks are bound to further increase. Moreover, it is difficult to imagine that the consumption will recover to its former level, even in the long term. For all these reasons, we still have to take action to rebalance the beef market, and this is not possible without the 7-points plan I proposed. It should be clear that this is a crisis management package, not a reform", he said.
The last available carcasses prices, compared to the level of prices before the crisis (in %) (week 19 of 2001 compared with week 42).
Again in the last weeks, EU prices got better except for cows. The price comparison above is done with the prices seen before the crisis. Normally we should have seen a price reduction of 6.7% (Agenda 2000). The real price reductions are therefore:
-12% for young bulls and -18.2% for cows.
The Market seems to respond slowly to the positive elements seen last weeks:
Drop in consumption and production
Figures for consumption given in the Management Committee of 18.05.01 are :
Based on this information, the EU drop in consumption is now estimated at about -10 %.
Until now, following quantities are bought into intervention:
BE 300 t
DK 295 t
DE 32,531 t
ES 73,562 t (but only 50,520 really bought-in)
FR 59,118 t
IT 32,213 t
NL 70 t
ÖS 8,196 t
Total 208,775 t (but only 185,000 really stored)
Purchase for destruction
The number of animals entering the "purchase for destruction scheme" are
FR 163,992 head
giving a total of 594,000 animals (or about 200,000 tons of meat).
Together with public intervention, about 385,000 t. of meat are removed from the market since the start of the crisis. Furthermore, the FMD destructions in UK start to take significant proportions in the beef sector where already more than 150,000 tons of beef are now destroyed (considerably less tonnage for sheep: 40,000 t. and pigs: 12,000 t.). As quite a part of this would otherwise have entered the OTMS, one could assume only about 90,000 t. is an effective removal of meat that would otherwise go to consumption. This brings the total quantity taken away at 475,000 tons.
Special Market Measure
The Special Market Measure is open in Ös, Nl and De. The quantities bought are:
giving a total of 1,163 tons
Effects on Trade with Third Countries
The % of of blocked EU export market is:
Beef : 65% of exports (Russia is open except for Uk, Irl, Fr, Nl, Be, Lu) Pigmeat : 30% of exports (Japan is open, Russia same as for beef)
The weekly quantity for which licences are asked is now between 6,000 and 7,000 tons.