Approximately 120 thousand tons are eaten in Lithuania in a year. Only 60 thousand tons are produced in the country, the rest is imported.
Less pork is produced in Lithuania, than we need. Therefor, we import the rest from abroad, looking for the best quality and price ratio.
While pork prices were low due to excess meat on the market, pig farmers did not increase pork growth plans, and now when the prices are rising, it is to risky to increase them, as it is not clear how long this will last. The situation is really unpredictable, so all the traders are watching the market closely. “In spring of 2019 pigs were bought below their prime cost, but later after African Swine Fever spread in China the prices started to rise.
Laurynas Zimblys, Director of Commerce at JSC Baltic Foods, says that pork prices in Europe and Lithuania remain high in the first quarter of 2020. The main reason for the high prices is the swine fever in China, which, to this day, is still unmanageable. As a result of this situation, the Chinese are buying in large quantities from the European Union countries, which strongly influences the high price level, even though just in spring of 2019 pigs were bought below their prime cost. Chine imposes stringent requirements and complicates the rearing of pigs. And while the market is attractive, producers are afraid of the risk and are hesitant to breed, for various reasons, such as high forage prices or unstable market. After a long hiatus and long negotiations, USA and China signed a 2 year trade agreement for agricultural productions, including pork. The contract came into force on the 1st of February and cheap pork from USA began to flow to China. Chances are that China will start buying less from the European Union, which will lower prices in EU, including Lithuania. However, it is still a matter of theory and guesswork, as the scale of Chinese swine fever is very high and the shortage of pork is very significant, so pork prices can continue to rise steadily. Another nuance is that the producers are collecting remainder of frozen produce in the hope of selling them at higher prices in the near future. But Chinese market is too big ant not enough transparent to be predicted, therefor after the start of trade with USA, there maybe be a sudden sell-off of residues in EU manufacturers’ warehouses, which will also strongly affect the price level in the market. Recently the swine fever was detected near the German border, which causes the country to be alarmed. If German swine fever was detected and its exports to China stopped, Germany would begin selling to the EU, which would also have a strong impact on the price decline. And, of course, Coronavirus and its spread can severally limit the volume of trade, but as long as the disease has not spread across the country, the trade is ongoing.
