Pork Commentary Jim Long, President-CEO Genesus Inc. December 5, 2016 Agromek DenmarkLast week was the Agromek show in Denmark. This is our report and observations.
Agriculture is an essential foundation of Danish business. Since the 70’s, Agromek has been a meeting place for farmers and the agricultural industry, and many visitors from around the world have been coming to Agromek for years. This year was the 40th anniversary of Agromek. More than 530 exhibitors (indoor equipment, breeding companies, and outdoor machinery) and 40,000 visitors were present, including Danish farmers, industry people, and international visitors.
Genesus was present at Agromek for the first time, introduced to Danish farmers by our distribution partner, Porc-Ex Breeding. Porc-Ex was formerly the largest global distributor of Danbred, and they have now chosen to sell Genesus. We had a busy show, with many visitors visiting our booth after hearing about Genesus’ presence at Agromek. They were curious to learn more about Genesus and our new setup with Porc-Ex Breeding. The response was positive and many expressed that they were happy to see new genetics in Denmark.
This is a major step for Genesus. In the recent past, Danbred had a near monopoly in the Danish market. Genesus’ new agreement with Porc-Ex Breeding gives Danish farmers a competitive choice.
The landscape for pig producers is always changing in Denmark. Today, Denmark has around 4,000 pig farms – in 1992, the number was 57,000 pig farms. The amount of pigs is almost the same, but farms are much bigger now. 68% of pig farms in Denmark today have more than 1,000 pigs. About 90% of Danish pork is exported. Germany imports the most pork from Denmark, followed by the UK, Poland, and China.
Today, Denmark produces about 30 million piglets/year, and 13.5 million are sold alive to the EU, with the rest slaughtered in Denmark. Almost double the amount of small pigs Canada sells to the USA per year.
In 1974, there were 54 Danish Crown slaughterhouses. By 1980, it had dropped to 20, and there are only 2 left today, along with 6 privately owned slaughter plants.
Prices: slaughter pigs 10.40 DKK/kg (0.67 USD/lb). Piglets at 30kg for 399.22 DKK, or $57 USD.
There are very few new barns being built in Denmark, some new due to subsidies, and mostly renovations. In the past few years, the legal requirements in sow housing has required large investments. There has been a split between ESF and free stalls.
There is an old saying: “it’s like taking coal to Newcastle.” That’s similar to Genesus being in Denmark. As we mentioned earlier, Danbred has had a near monopoly on the home market, but in recent years, they have left the huge North American and Russian markets. This loss of markets has led to turmoil in their organization. This has led to an initiation to reorganize their whole structure, which has resulted in multiple lawsuits and general unhappiness.
In adversity, there is opportunity. Genesus has excellent health and production traits, and the same genetic breeds as Danbred – registered Durocs, Yorkshire, and Landrace. It’s about comparing and deciding. Genesus production is ramping up in Europe and nothing is easy in this industry, and we look forward to our journey with Porc-Ex. You have to bring value to your customers, wherever they are.U.S. Market
Our sense is that the bottom is in the U.S. hog market. Hog weights are 5lb carcass weight below a year ago, reflecting aggressive producer marketing. U.S. pork cut-outs are staying strong, at $0.74/lb despite huge marketings. Packer gross margins are excellent, at nearly $60 per head. We expect that as hog marketing decreases, there will be a rapid increase in lean hog prices.
Ultimate Pork Experience Agro Belogoria Launch Genesus Duroc Meat Brand
On Sunday November 20th, Agro Belogoria, Russia’s 4th largest pig producer and packer, launched its Genesus Duroc Pork.
The launch was made at Agro Belogoria’s own restaurant, “Riviera”, where guest Spanish Chef Jorge Sevilla prepared the dishes for tasting. Chef Sevilla comes from “Globus Gurme”, a chain of premium class grocery stores in Moscow and St. Petersburg.
Spain, which is famous for Jamón and the Ibérico pig, have many chefs that understand how to properly cook pork with excellent quality for the perfect eating experience. He mentioned that Genesus Duroc meat, based on colour and taste, could be competitive with Spanish Jamón!
Attendees of the launch were chefs of Belogorod restaurants and the Board of Directors of Agro Belogoria.
The day started with an introduction speech by Agro Belogoria Chairman Vladimir Zotov, who said that the current goal of the company’s production team is to improve meat quality.
Thus, the Genesus Duroc’s meat will change our opinion about Pork.
The Manager of Agro-Belogoria’s trading company, Olesya Dmitrova, mentioned that to achieve a proper taste, the meat got matured for 7 days versus the 1 day for their standard commercial pork. Genesus Duroc pork has a very delicate flavor, looks very attractive, and has an excellent taste when baked, fried, or smoked.
Genesus Representative Natalia Zarubina said that for over 20 years, Genesus has done extensive work on more marbling for our clients to achieve the ultimate pork from Genesus pigs. Better flavour has been Genesus’ quest, in partnership with the family farms of the Red River Valley.
Chef Jorge Sevilla presented several different pork dishes for guests to taste. All agreed that the pork was very tender and tasty. Many people commented that if it had been a blind tasting, they would have thought they were eating top quality beef. Others commented that it was excellent, juicy meat with a nice flavor.
Agro Belogoria will market the Genesus pork at a premium price of 20% over their standard product. Orders were taken at the event, and all available production was sold.
Genesus Registered Durocs meet all standards of the USDA approved Certified Duroc Pork Program.
This post was written by Genesus