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Adding value to spanish exports


10 DE abril DE 2017

The current size of Spain's meat sector

José M. Álvarez. @jmalvarez60

The meat industry is Spain's fourth-largest industrial sector, behind autos, oil and gas and electric power. Comprised of slaughterhouses, cutting rooms and processing companies, there are close to 3,000 businesses nationwide, particularly in rural areas. Although a large portion of the sector are SMEs, there has been a gradual merging among large business groups, some of them leaders in Europe. Production by all of these companies together makes it the largest segment within Spain's food and beverage industry, with revenues of 22.600 billion euros, accounting for 21% of Spain's food sector total.

This accounts for approximately 2.1% of Spain's total GDP (at market prices), 13.1% of industrial GDP and almost 4% of the Spanish sector's total revenues. The industry provides 84,000 direct jobs, which account for 23.5% of the total jobs in Spain's food industry.

It's worth noting that the meat industry exported almost 2.3 million tons of product last year, worth 5.562 billion euros, to markets all over the world, with a very positive trade balance of 494%, a figure very few of the main economic sectors can achieve, helping ease Spain's traditional trade deficit.

Spanish meat production

In 2016, Spanish pork production reached a new record high, exceeding 4 million tons. That represents growth of 5.2% with respect to 2015, with the pork sector producing 4.06 million tons of meat.

The beef and sheep sectors strengthened the trend towards recovery that began in 2013, with beef production increasing by 1.9%, to 637,737 tons, and sheep/goat production up by 1%, to 126,341 tons.

The Spanish market for meat products

Spain is a country with a very strong tradition in the production and consumption of various types of cold cuts and hams. Our diverse pork production, which extends across the entire country, is part of our cultural and gastronomic heritage, and is appreciated in Spain and far beyond.

In addition to the food channel, another extremely important segment is hospitality and foodservice, which are vital in terms of consumption of all kinds of meat products, but especially for leading items such as Serrano and Ibérico ham, as well as cured sausages and cold cuts of all kinds.

Foreign trade in meat

Foreign trade in meat reached a new record in 2016, comfortably surpassing 5 billion euros in exports, which also broke past the barrier of 2 million tons of meats and processed products sold in markets around the world.

This spectacular data confirms that the meat industry has gone from zero sales abroad to become the leading exporter in Spain's agri-food industry and a top player in the global market for meat products in a little more than 25 years.

The Spanish meat sector exported 2.27 million tons of meat and processed products of all kinds in 2016, with a value of 5.562 billion euros, to markets all over the world, reflecting growth of 16.7% in volume and 14.8% in value with respect to 2015 and with a very positive trade surplus of 494%.

These outstanding figures are based in large part on the exceptional performance of the pork sector, in which Spain is already one of the four largest global exporters, along with Germany, the US and Denmark.

A total of 1,490,036 tons of pork were exported in 2016, worth 3.207 billion euros (another record, breaking the 3 billion euro barrier), reflecting 18.8% growth in volume and 18.6% in value, as well as very good results for processed products: 182,566 tons (+6.2%) and 1.150 billion euros (+6.7%).

It's also worth noting the considerable growth in offal exports: 396,539 tons (+21.4%), worth 447 million euros (+26.3%).

As for beef, the trade balance for meat and offal exports was also positive, with a record 169,539 tons exported (+4.0%), reinforcing the notable improvement achieved in 2015, and obtaining 610 million euros, up 7.1% year-on-year.

The bulk of Spanish exports still go to the European Union, and of those, most head to France, Germany, Portugal and Italy. To that end, the sector has two notable challenges in this area: increasing sales to non-EU markets, and boosting exports of our products with added value, i.e. those that make us stand out from our rivals in international markets, starting with emblematic Spanish products such as Ibérico and Serrano ham.

In this regard, it's worth noting that (pending definitive data at year-end) around 44% of total exports of meat, offal and pork fat were sold to non-EU countries, up 50% year-on-year. China is the main importer of Spanish pork, ahead of France, Italy, and Portugal, together with other large Asian markets such as Japan and South Korea.

In the case of beef, less than 10% of sales head to non-EU countries, reflecting the potential that beef and sheep as those segments focus on internationalization. To that end, the Spanish market must gain a foothold in important markets that are banned at the moment where other rival countries are selling their products.

The industry is asking the Spanish authorities to focus on finding a way to enter those countries and to unify the administrative powers that make the Spanish sector more competitive and eliminate inefficiencies in international business.

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