Pork industry expects a price rise

Australian Pork Limited expects farm-gate prices for pigs to increase by 10 percent over the next five years.

Australian Pork Limited has launched its five-year strategic plan, and increasing pork’s value and improving access to markets like China are Key priorities, ABC Rural reports.

Chief executive Andrew Spencer said “We're looking at an ex-farmgate price development of about $3.16 in 2015 to $3.46 in 2020.

“So that's 30 cents a kilo. But we're probably by that stage producing about 400,000 tonnes a year, so it's probably around about 10 per cent, so it's a lot of money.”

Spencer said the optimism is being spurred on by a growing demand for beef and lamb, both within and beyond Australia.

“With the production intentions of those industries and the demand that we can see there being there for our product, it doesn't look like prices are going to come down for things like beef and lamb, and that probably also supports continued good consumption for pork.”

The pork industry spends $25 million on marketing and research each year. Roughly half of that money is invested in research and development, while the other goes towards marketing and strategic planning.

Spencer says campaigns, including 'Pork on your Fork', and licensing its Australian pork logo for use on local products have been successful.

“We think that'll continue to be the backbone of our promotional efforts,” he said.

But the Pork industry is faced with the competition of cheap imports, with 70 percent of ham and bacon eaten in Australia grown on the other side of the world, which is why the industry will focus on improving export potential and establishing new international markets.

But the industry still doesn't have access to China, and while Spencer says talks are underway, it's a slow process.

“We have not included significant export volumes to China in our five-year plan because we think it will happen beyond the period,” he said.

Even so, he expects exports to increase over the next five years.

“We're only in 2015 expecting to export about 35,000 tonnes, and that will grow from about 48,000 tonnes by 2020, so in terms of total volume, compared to the total volume we produce each year, it's not a huge amount.

“But if we are successful in markets like China, that number will grow much more.”

 

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