Business Environment Profiles - Australia
Published: 04 July 2024
Domestic price of pig meat
101 Index
4.0 %
This report analyses the prices received by farmers for pig meat (pork) using an index. The production of pig meat refers to the slaughter of pigs and production of meat that is sold as fresh meat, or as processed products like bacon, ham and smallgoods. The data is in financial years, is gathered from the Australian Bureau of Agricultural and Resource Economics and Sciences and is measured as an index with a reference year of 2021-22.
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IBISWorld forecasts the domestic price of pig meat to fall by 2.7% in 2023-24, to 100.6 index points. Prices are expected to stabilise due to the easing of input cost pressures and a shift in consumer preferences towards beef and sheep meat consumption. Relative declines in beef and sheep meat prices have been contributing factors to the increased consumption of alternative meats to pork and other pig meats. Prices fell from a sharp high in 2022-23 tied to heightened input costs and high demand from overseas markets, like Singapore, the Philippines and New Zealand.
Domestic pig meat production has fluctuated in recent years but risen overall, supported by global demand trends and improved weather conditions over the past three years. Global supply has been affected by the outbreak of African swine fever (ASF) initially in China, which resulted in the loss of over half its national herd. Consequently, demand for pork imports in China increased and placed significant upward pressure on global prices over the two years through 2019-20. African swine fever has since spread to other countries in Asia as well as Europe.
Pig meat consumption has risen over the past decade. However, the volume of imports has also increased. Pig meat imports are primarily from the United States, Denmark, Canada and the Netherlands. Quarantine regulations limit pig meat imports to processed meat only. Foreign producers that have greater economies of scale can often provide lower prices than domestic pig meat producers. This trend is particularly true for foreign producers that benefit from government subsidies. Even so, changes to the local and global supply chain over the two years through 2019-20 pushed up prices. Domestic production fell in 2019-20, while global output was impacted by the ASF outbreak which wiped out nearly half of China's swine herd. Production diminished again in 2021-22 due to lower inventories of pigs and reduced farrowing. Production has expanded in 2020-21 and the current year, though, despite these fluctuations in breeding numbers. Overall, IBISWorld forecasts domestic pig meat prices to rise at a compound annual rate of 4.0% over the five years through 2023-24.
IBISWorld forecasts the domestic price of pig meat to drop by 0.3% in 2024-25, to 100.3 index poi...
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