The drought drives up the price of meat

The drought drives up the price of meat

2023-08-22 19:21:19

Barcelona The drought and the consequences of the Russian invasion of Ukraine have kept the price of meat up in Catalonia. The cost to consumers of all types of meat on the market is higher than before the war, and despite the difficulties, producers are able to recover some of the losses recorded in 2022.

Evolution of the price of meat

Consumer prices in Catalonia. Index where 100 = January 2015 price

“Climate change and the war have brought us despair,” says Rosa Pruna, president of the association of farmers and ranchers Asaja. The price of meat began to rise about a year before the Russian attack on Ukraine, but the pace of increases accelerated with the war, as with the rest of the shopping basket. In fact, especially in the second half of 2021, commodity prices were already on the rise due to the reactivation of the global economy, which caused bottlenecks in supply chains and shortages in some industries Even so, at present, inflation in Spain has cooled significantly and in June it even closed below 2% year-on-year, the target set by the central banks, a figure that contrasts with the 10 % of several months in the summer of 2022.

Despite the moderation of the CPI, meat prices remain high, especially compared to a few years ago. For example, the price per kilo of U-type pork (between 50% and 55% lean) was sold in mid-July at 2.8 euros, while at the time of the invasion of Ukraine it was 1 .54 euros, according to the average price in Catalonia marked by the Llotja de Vic i Mercolleida and registered by the Department of Climate Action, Food and Rural Agenda of the Generalitat.

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Likewise, the price of lamb has risen from 8.1 to 8.9 euros per kilo in the case of pieces between 12.8 and 14.5 kilos at the Llotja de Girona, while the crossbred calf was at 4.45 euros per kilo of meat in the last week of February last year and now it is sold at 4.8 euros in Mercolleida.

The current prices are “good to recover a little” from the previous season, “but they are not so good for the consumer”, explains Pruna, as the higher price of the final product causes a drop in sales. “We would prefer to sell cheaper” but with less of the difficulties the sector has had in the last two years.

The drought has a huge impact on costs

2022 was the hardest for the sector, because severe drought affected cereal production, but also because production costs soared due to the war. Energy (electricity and fuels) hit a ceiling last summer, as did phytosanitary products, along with cereals – Russia and Ukraine are one of the world’s leading grain exporters. Cattle feeding depends to a large extent on cereal production, where both the straw and the grain used to make the feed come from.

This year the situation has improved, with lower energy prices and other costs. Despite this, the drought that is ravaging Catalonia and much of southern Europe has seriously affected cereals. “The cereal harvest is practically all lost” this year, Pruna says. The lack of rain has also affected fodder production, and the spring rains have not improved the situation.

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Straw production on many farms has been reduced and farmers have opted to import it, especially from France, where there has been more rain. However, the price has tripled, from 50 to 150 euros per ton. “It’s not given as much importance as feed,” says Pruna, but to get good quality meat many cattle farms have to alternate between grain, straw and forage for the animals.

The lack of water has direct effects on the price of grain and straw that is purchased, but also for extensive livestock operations that rely on pasture. In this sense, the beef, sheep and goat sectors are the ones most affected by the drought: “The lamb sector is suffering a lot because of the pastures”, recalls the president of Asaja. However, farmers with extensive sheep and goat farms – also farmers of dairy cows – have direct lines of aid from the Catalan government, which have not been extended, however, to pigs or the rest of cattle.

The difference in the pig sector

If Catalan livestock farmers have experienced difficulties during the year due to the aforementioned cost increases, the pig sector is the one that has had the most facilities thanks to its export capacity. Specifically, the pig sector is the one least suffering from the situation, since it is the most internationalized: Catalonia exported 3,233 million euros of pork in 2022, an increase of 11% compared to 2021, which they represent 61% of all sales abroad of Catalan meat and sausages, according to data from the Catalan Food Promotion Agency (Prodeca) of the Generalitat.

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Swine fever has affected several European countries (especially Germany) and has helped the Catalan food industry to increase sales to other countries that were looking for alternatives, such as China, according to Asaja.

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