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26/09/2017

The egg-laying poultry sector is hanging on (II)

(Continuation from The egg-laying poultry sector is hanging on, Part I)

Ricardo Migueláñez. @rmiguelanez

European foreign trade

In 2016, the European Union imported 21,939 tons (egg equivalent) from non-EU countries, of which more than half headed to Denmark (13,304 tons), followed some distance by Germany (2,619 tons); Austria (1,331 tons) and the UK (1,230 tons). Spain imported just 135 tons. Imports peaked in 2007, at 66,415 tons.

Eggs were imported from the US, which accounted for 20.8% of the total (4,573 tons); Argentina (9.9% and 2,163 tons); India (5.6% and 1,231 tons); Albania (3.8% and 824 tons), and other countries (59.9% and 13,150 tons).

In contrast, last year the EU exported 337,956 tons, i.e. 10.6% less than in the previous year. The main exporters were the Netherlands (116,259 tons); Italy (79,426 tons); France (42,876 tons) and Spain (25,172 tons) in fourth place, ahead of Belgium/Luxembourg (21,243 tons); Germany (18,816 tons); Poland (11,239 tons), etc.

Exports set a record in 2015, at 377,884 tons, due to the spread of bird flu in several Asian countries.

The main non-EU destinations for EU exports were Japan (22.4% and 75,800 tons); Switzerland (14.1% and 47,581 tons); the UAE (5.6% and 18,937 tons); Israel (4.3% and 14,478 tons); Russia (2.6% and 8,836 tons), Oman (1.4% and 4,463 tons), Ukraine (1.4% and 4,801 tons), etc.

The degree of self-sufficiency

According to provisional 2016 data, Spain's level of self-sufficiency in terms of eggs is positive, as production exceeds consumption by 14.3%. Consumption is around 13.9 kg per person per year, down 0.5 kg with respect to the previous year and considerably more than the 2.5 kg per person per year between 1986 and 2005.

Spain produced 914,300 tons of eggs last year, of which 63,300 tons were for hatching and the remainder were for other uses, including human consumption. Imports amounted to 36,400 tons (5,100 tons of eggs for hatching) and exports totaled 150,600 tons (45,020 tons of eggs for hatching and 105,600 tons for other uses). Total domestic use reached 800,100 tons, of which 649,000 tons were for human consumption, 127,000 tons for industrial use, and 23,400 tons of eggs for hatching.

Egg consumption by households has registered a slight downward trend in recent years. Consumption amounted to 376,173 tons in 2016, reflecting a slide of 0.6% compared with 2010. Compared with 2015, consumption slipped by 0.12%, when it amounted to 376,633 tons. There's some stability in terms of per capital consumption of eggs by households, with slight rises and falls in recent years. En 2016, the total was 137 units per person per year, of which 116 were battery hen eggs, 18 were eggs from alternative poultry-keeping methods, and 3 were from other birds. Per capita spending on eggs amounted to 19 euros according to the Ministry of Agriculture and Fishing, Food and the Environment's Consumption Panel, and total consumption amounted to 815.76 million euros.

Domestic consumption of eggs reached 95,477 tons in the first quarter of 2017, reflecting a decline of 1.25% year-on-year and of 4.72% compared with 2010, according to the Ministry, when consumption surpassed 100,000 tons.

In the EU, Gross Indigenous Production of eggs totaled 7.7 million tons in 2016 (+1.85% year-on-year), with imports of eggs and egg products equivalent to 22,000 and exports of 338,000 tons of shell eggs. Domestic use amounted to almost 7.4 million tons, with 6.75 million for consumption and 742,000 tons for hatching. Human consumption totaled 13.2 kg per person per year, slightly more than in 2015 (13.1 kg), while the level of self-supply was 104.3%, i.e. production exceeded domestic consumption by 4.3%.

Background

In short, Spain's egg sector registered a 5.7% increase in the number of egg-laying hens, which amounted to 43.61 million, and a 5.7% increase in egg production, which totaled 1,125.7 million dozen. In terms of foreign trade, 133,000 tons of shell egg equivalent were sold in the EU, i.e. 8.8% less than in 2015, when sales peaked at 145,800 tons (+16.3% compared with 2014) while imports from the EU totaled 49,400 tons (+12.3%). Outside of the EU, Spain exported 34,600 tons, around 30.5% less than in 2015, which was a record year, with 49,700 tons heading to non-EU countries (+196.43% compared with 2014), and Spain imported roughly 800 tons (+14.3%).

Market prices (for L/M category eggs) slipped by 19.4% on average in 2016, to €82.66/100 kg, after having already fallen in 2015 by 3.44% (€102.49/100 kg) compared with the previous year (€106.25/100 kg). This same trend, though slightly weaker and above the Spanish average, occurred in the EU, with a 12.5% decline in average prices ( €113.43/100 kg) compared with 2015, when prices rose by 1.65% on average ( €129.64/100 kg) compared with 2014.

According to recent data, in June of this year (week 22), the average price of L/M category eggs was €89.91/100 kg, down 10.52% since the beginning of the year, but 14.62% higher than during the same period of 2016, while prices in the EU for the same period reached €121.35/100 kg on average, i.e. 4% less than at the beginning of the year but 14.77% higher than during the same week of 2016.

According to the Ministry of Agriculture, gross margins on egg production in 2017 remain positive, up 6.93% compared with the beginning of the year, due to lower food costs, which are the main (though not the only) production cost. The price of feed for egg-laying hens averaged €25.09/100 kg in March, 10% lower than the average of the last five years.

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