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Philippe Mallétroit – Director for France, Genesus
Covid-19 crisis
After appearing in November 2019 in the city of Wuhan in China, the Coronavirus pandemic (Covid-19) spread all over the world, from continents to continents, creating unprecedented health and economic crisis.
Like many other European countries, France started containment on March 17, and this until May 11th. During this period, many parts of the French economy are at a standstill (restaurants, hotels, shops, etc.).
As of the 27th of April, 10.8 million people were unemployed in France, and 84 % of their salary will be paid by the French Government.
Nevertheless, during these difficult times, agricultural and agro-food businesses continue their remarkable work to continue feeding their fellow citizens.
Since the beginning of the pandemic, with the closure of restaurants and the slowdown in exports, some industries have suffered more than others, such as beef and dairy production. About pig production, we can be pleased for once that this health crisis has not, for the time being, had too much impact on the prices of pork down.
No slaughterhouse closures were reported (unlike North America), neither no noticeable slowdown in the processing plants and, hog supplies to slaughterhouse remained fluid.
Different situations in different countries
Depending on the country, the impact of the Coronavirus crisis on hog prices has been more or less strong.
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Since the beginning of Covid-19 crisis, hog price in Spain decreased by 11.2 % between the 15th of March (beginning of containment in Spain) and the 23rd of April. Spain is an important exporter, and the first pork exporter in Europe to China.
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In the United States the containment began a little later depending on the States (on March 20th in California, April 1st in Florida). Between March 27th and April 23rd, the market hog price dropped by 37%! The United States, a major exporter of pork, is strongly affected by the Coronavirus crisis, particularly due to the closure of some packing plant (as Smithfield) due to coronavirus cases and the increase of workers’ absenteeism.
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In France, since the beginning of the containment on March 17th, the price of pork has remained overall well, except the drop of 3.4 cents per kg carcass on April 23rd which corresponds more to the holidays period (May 1st and May 8th are public holidays), with two 4-day weeks.
Hog market price dropped by 5.4 % between March 16th and April 23rd. France is not a major exporter of pork, unlike US or Spain. This weakness seems to be a strength in this crisis period.
New consumption habits?
In addition, since the beginning of the containment, sales of deli meats and cooked ham have been doing very well, probably due to the fact that a large number of people end up at home every lunch. In March, some pork meat processing plants saw their production increase by 20 to 30%.
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One of our French producer who owns some stores told us that in some places the sales surged since the beginning of the containment. Moreover, it seems that this unprecedented crisis is beneficial for local trade and, short food-supply chain circuit that becomes more and more popular for French consumers.
Will this still be true after the Covid-19 crisis?
Categorised in: Featured News, Global Markets
This post was written by Genesus