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World Meat Congress

GDP fall set to hit meat industry

By Ed Bedington , 08-Jun-2012

The economic downturn and fall in global GDP growth is shaping up to be a serious “cloud on the horizon” of the meat industry, a leading expert told delegates to the World Meat Congress in Paris.

David Nelson, from the Rabobank Food and Agribusiness Research and Advisory Group, said: “GDP growth is key factor driving growth of meat and it’s not happening in the developed world. But the cloud on the horizon is that world GDP growth is in decline and that’s of concern, even in the developing markets. Growth in China has declined from 10% to 8%, but most people in China think it’s more likely to be 7%. In Brazil it’s going to fall to 3%.”

He said other market dynamics would also have an effect. While demand was growing for protein, crop production was declining and, with the emergence of pesticide resistant weeds a by-product of GM crops, he claimed, farmers were finding yields falling.

On meat production, he said beef farming in northern Europe was likely to see a greater switch to dairy production, while quality beef production would move south to countries like Italy and the southern regions of France, with CAP reform encouraging that shift and leading to a fall in production volumes.

He also predicted falls in pork production within the EU, fuelled by low prices and changes to legislation: “Europe may not be much of a pork exporter in four or five years time.”

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