Nicosia, 10/09/2012 (Agence Europe) - On the sidelines of the informal Agriculture Council in Nicosia on Sunday 9 September, Dacian Ciolos, the European Agriculture Commissioner said of the effects of the drought in the United States that "we cannot talk of a crisis" in Europe, as there is no problem in terms of supply for the European cereals market. However, it is clear that this drought has had an impact on prices of maize and indirect fallout on the prices of other cereals, such as wheat. The Commissioner admitted that this could have an impact on the livestock sector.
The European Commission is observing changes in the price of meat and milk and in the costs and margins of producers. "We may suppose that a proportion of the increase in feed costs could be absorbed by the fact that meat prices remain fairly high globally", Ciolos said. Demand increases and the drop in maize production in the United States has led to a higher performance of European meat and milk globally. This is why milk and meat prices can be expected to be fairly high in the European Union this year.
It is worth noting that in the European Union, there has been no major drop in production, as the fall in cereals production is in the order of 2 or 3%. (L.C./transl.fl)
In a note on European cereals production, the European agricultural organisations take the view that the increase in prices of agricultural raw materials is likely to have an impact on the cost of animal feed, which has already risen 30% since 2008. This, particularly as the global market for oleaginous crops has entered a relatively tense period up to mid-December (in anticipation of the harvests of the southern hemisphere). The drop in production of oil seed rape in Europe and limited milling capacity in Canada and Australia are therefore likely to shore up this increase. Additionally, many feed businesses are not covered for the period from June to October and will have to buy their cereals at current market prices. These increases are likely to bring about additional production costs of 8% for pork meat and 10% for poultry. (LC/transl.fl)