Russian trade ban inflicts maximum damage
The international meat market – which has been thrown into further disarray by the UK’s decision to leave the EU – has been hit hard by Russia’s debilitating trade sanctions. In fact, Russian import bans slammed down on Europe, the US, Canada and Norway has had more of an impact on international meat commerce than any other trade-related issue.
This is according to GlobalMeatNews’ state of the industry survey for 2016. Drawing on key insight from some of the most important people in the global meat processing arena, report results highlight some of the most pressing issues in the industry, as expressed by our readers. Views of 384 respondents were collected and quantified to build a global picture on the meat industry’s attitude toward trading relationships, environmental management, animal disease, Brexit and investment.
For the second year in a row, the majority of readers (31%) said Russia’s trade bans – like the 2014 pork embargo and the 2015 blacklisting of US and EU meat imports – hit their businesses the most. This was an increase of 4% on the year before.
More than half of respondents remain on high alert and fear the outbreak of contagious animal diseases. Porcine epidemic diarrhoea virus (PEDv), African swine fever and avian influenza are the diseases to cause a drop in business confidence. A total of 51% said they were “very concerned” about livestock viruses and fretted about it more than in previous years.
The spread of the highly pathogenic H5N8 avian influenza strain that tore through South Korea, Taiwan, the US, UK and Russia over the last couple of years has had the most impact on the meat industry, according to the survey. In fact, 15% of respondents cited this as a major concern for business. The devastating PEDv virus that caused the deaths of 10m pigs in the US ranked as the second-most alarming virus with 7% said to have suffered. The spread of African swine fever in eastern Europe, which incidentally caused Russia to close its market to European pork, ranked third in debilitating disease after 3% of respondents claimed their business was damaged. Only one in 10 respondents were “less concerned” about the impact of animal disease.
There’s been a 6% drop in the number of respondents who think there should be increased emphasis and regulation on animal welfare. This comes against the backdrop of the landmark O’Neill report on antimicrobial resistance which claimed the rise in routine antibiotic use may cause a serious threat to human and animal health. Despite the drop in demand for regulation, 77% of respondents still believe more should be done to improve animal health policy.
Volatility in meat verticals like beef has done nothing to dent ambition. Positively, 65% of respondents agreed that their company was interested in exploring new export markets this year. A further 54% said they felt more optimistic about the future now than they did in 2015. Investment, too, looks increasingly likely to play a key role moving forwards, with 54% of respondents believing that their business planned to make further capital investment.
This survey was concluded before the UK voted to divorce the EU, but just under one third (31%) feared a Brexit vote would be bad for business. A further 14% are concerned that the vote may lead to a second Scottish independence referendum, plunging the UK further into the depths of the unknown. In the face of increasing uncertainty the meat industry remains relatively optimistic and expects consumer spending to go up in the coming year.