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Chilean pig meat production has been increasing

Christian Fernsby |
Although a small exporter, Chile has premises licensed to ship pork to the EU.

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North American pork could become price-competitive under a no deal Brexit.

What about Chilean pork?

We do not have cost of production estimates for Chile, AHDB reports.

The average export price is higher than from the US and Canada, so it is reasonable to assume the product is less price competitive.

This is especially true considering almost all Chilean exports are frozen.

Live pig prices are also higher than in neighbouring Brazil, another sign that production costs are higher.

As Chile is on the west coast of South America, it costs more than twice as much to ship product to the UK from Chile, than it does from the east coast of the US/Canada and the EU.

Nonetheless, Chilean pig meat production has been increasing.

Chile is a net exporter of pork, so this growth translated into exports (154,000 tonnes last year +17% on 2017).

According to the USDA, Chilean pork production totalled 602,000 tonnes last year, 3% more than in 2017.

Meanwhile, consumption remained flat at 417,000 tonnes.

The USDA expects these trends to continue, driving further export growth.

China is already the largest destination for Chilean pork exports.

This market will probably absorb more volume this year due to the serious African Swine Fever situation.

Forecasts suggest Japan, another key market, may also show an increasing need for imports.

Yet, there is less optimism around the other two key destinations, South Korea and Russia.

Chile is one of the few countries still able to export pig meat to Russia, sending 29,000 tonnes last year.

This was double the year before, because of compromised Brazilian access.

Russian production is expanding though, and this will restrict import requirements in the future.

So, it seems like the much of the global pork market, the outlook for Chile’s pig industry hinges on the Chinese market this year.

Time will tell who will benefit most from the developing opportunities.

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