#18 The Meat Traders' Journal

^{If you missed the last newsletters, you can look them up here.}

Market Movers & Shakers Intel

Global Pork Meat Market Analysis

Population Changes: There's been a noticeable decline in the total pig population across the EU from 2021 to 2023, with a small uptick in some categories such as piglets under 20 kg and breeding sows in 2023.

Production Shifts: Some countries like Bulgaria and Slovakia showed significant increases in specific pig populations, while others like Ireland and Croatia reported considerable declines, suggesting a shift in regional production capacities.

Price Dynamics:

• Recent Trends: Prices for pig carcasses have declined overall by 8.3% from the previous year, indicating a decrease in market value per unit.

• Piglet Pricing: The price for piglets increased slightly by 1.3%, suggesting a growing market or higher costs in breeding investments.

Trade Patterns:

• Exports: The EU's pig meat exports are marked by a slight reduction, with significant markets like China experiencing a drop in import volumes from the EU. This might indicate a need for diversification in export markets or strategies.

• Imports: Imports into the EU show variability with significant increases from countries like Chile, reflecting a potential shift in supplier preferences or availability.

Short Term Assumptions

• Market Recovery: Given the slight increase in breeding sows and piglet numbers, a short-term recovery or stabilization in production volumes may be expected.

• Price Adjustments: Prices may continue to adjust, influenced by production costs and market demand. A slight increase in consumer prices could occur if production costs rise or supply constraints are experienced.

Long Term Assumptions

• Shifts in Trade Dynamics: With changing global meat consumption patterns and trade tensions, the EU might need to explore new export markets or enhance domestic consumption strategies.

• Technological Advancements: Adoption of more efficient farming technologies could be crucial in reducing production costs and enhancing output, potentially stabilizing the market over the long term.

•  Regulatory Impacts: Changes in agricultural policies or trade agreements could significantly influence market dynamics, requiring ongoing monitoring and strategic adjustments by stakeholders.

👩‍💻IoT in Food Tech: (Continuation)

Last week you were introduced to IoT in Food Tech.

We dived into:

1. how IoT does impact in Agriculture, cold chain management and inventory management.

2. what kind of devises are used in Food Tech (sensors and tracking systems, connected appliances and wearable tech.

3. Possible benefits and challenges of IoT in Food Tech.

This week I cover

• who should implement IoT?

• What companies do implement IoT?

The integration of Internet of Things (IoT) technology has significantly improved food safety and logistics in the food industry, reducing the risk of foodborne illnesses and enhancing supply chain efficiency. IoT uses sensors to monitor key parameters such as temperature throughout production, shipping, and storage, crucial for maintaining cold chain integrity and complying with food safety regulations via automated Hazard Analysis and Critical Control Points (HACCP) checklists.

Additionally, RFID transmitters and GPS systems revolutionize logistics by enabling real-time monitoring of the distribution chain, adjusting inventory based on consumer demands, and streamlining deliveries.

Transparency is vital in today’s food supply chains. IoT technology increases traceability, building consumer trust by making food product origins and handling processes clear and verifiable, which also aids in inventory management, reduces costs, and accelerates operations.

In production and storage, sensors are essential for quality control, instantly correcting deviations and optimizing processes to help reduce the significant global food waste problem highlighted by the United Nations, which estimates a third of all food produced is wasted.

IoT also improves maintenance by enabling predictive monitoring, which anticipates and resolves issues before they escalate, minimizing downtime and saving resources. These technological advancements not only address current challenges but also contribute to more sustainable and efficient future practices.

Examples of FoodTech Companies Using IoT

👍️ Just Eat: This food delivery service employs IoT-enabled trackers to give customers real-time updates on their order status and location, boosting transparency and satisfaction.

👍️ McDonald's: McDonald's incorporates IoT technologies like smart kitchen appliances and digital menu boards to enhance operational efficiency and customer service.

👍️ Zest Labs: Specializing in perishables, Zest Labs uses IoT sensors to track food freshness and quality throughout the supply chain, helping reduce waste and manage inventory more effectively.

👍️ AgShift: AgShift applies computer vision and IoT sensors to streamline the quality inspection process, enhancing accuracy and efficiency.

Regulation

One of the most significant and influential trade agreements impacting meat trading is the North American Free Trade Agreement (NAFTA), and its successor, the United States-Mexico-Canada Agreement (USMCA). These agreements have had profound effects on the meat industries across North America.

NAFTA, which was in effect from 1994 until it was replaced by USMCA in 2020, significantly liberalized trade between the U.S., Canada, and Mexico. It allowed for the tariff-free exchange of agricultural products, including meat, which led to a substantial increase in the trade volumes of beef, pork, and poultry across the borders of these countries.

The USMCA preserved most of the trade liberalization benefits of NAFTA but included several updates and changes, such as new provisions for sanitary and phytosanitary measures, which are important for the meat industry as they deal with food safety and animal health standards.

The United States-Mexico-Canada Agreement (USMCA), like its predecessor NAFTA, primarily impacts meat trading within North America, but it also has significant indirect effects on global markets, including Asia and Europe.

Impact on Asia

1. Competitive Pricing and Market Access: USMCA can influence meat prices globally as it affects the supply dynamics in North America. For instance, if beef production in the U.S. increases due to better trade terms with Mexico and Canada, this could lower global prices, impacting meat exporters in Asia like Australia and New Zealand, which are major players in the Asian markets.

2. Shift in Trade Flows: With North America becoming more self-sufficient in meat production, Asian countries might find increased opportunities or challenges in exporting to this region. For example, countries like Japan and South Korea, which import considerable amounts of meat, may experience changes in their sourcing strategies, potentially turning to alternative markets if North American meat becomes cheaper or more expensive.

3. Regulatory Standards: The sanitary and phytosanitary measures and animal welfare standards adopted in the USMCA could set new benchmarks that might influence standards in Asian markets, particularly if these regions aim to align more closely with North American standards to ease trade relations.

Impact on Europe

1. Trade Diversion: European meat exporters might face competition in third markets where North American meat products become more competitive due to the efficiencies and cost reductions stemming from USMCA. European products might need to find new markets or reinforce their presence in existing ones by emphasizing quality or specific attributes like organic or free-range.

2. Regulatory Influence: The USMCA includes modernized approaches to trade issues that could serve as a template for future trade agreements between North American countries and European nations. For example, adjustments in regulatory alignments and protections for geographical indications (which are more prominent in Europe) could be influenced by norms set in the USMCA.

3. Strategic Alliances: As trade dynamics shift due to USMCA, European countries might seek to strengthen their trade agreements either within the EU or with other trading partners to counterbalance the influence of North American meat in global markets.

Broader Global Implications

1. Global Standards and Practices: The implementation of USMCA standards regarding labor, environmental protection, and digital trade could push global markets towards adopting similar standards, affecting global trade policies and practices, including in the meat industry.

2. Supply Chain Adjustments: Global meat supply chains may need to adjust due to changes in trade flows and regulatory practices prompted by USMCA. This could mean new investments in certain regions or a retraction from others depending on how competitive entities can remain in the changing trade landscape.

Since its implementation, USMCA has spurred over 68 billion dollars in new economic activity across the three countries involved, with a notable increase in agricultural trade including meat products​ (OCF Berkeley)​.

In 2022, trade within North America under USMCA exceeded $1.5 trillion, reflecting robust growth and making Mexico and Canada the top trading partners of the United States. This growth has not only been beneficial in terms of trade volume but also in generating employment, with intra-regional goods trade supporting 9.5 million jobs across North America​ (Brookings)​.

Now we now what is the most important and profitable trade agreement in the Meat Trading Industry. Next week I will talk about the Likely Second most important trade agreement, the European Union-Mercosur Trade Agreement. Let’s discover next week why and why I say “likely”.

Did you know? 🔖

Who is Driving Meat Sales in America?

Circana's data reveals that Generation X, despite being the smallest generation, leads in meat sales with a 32% share. Boomers purchase meat most frequently, averaging 53 times per year, while Millennials tend to spend the most per purchase, with an average of nearly $17.

Economic factors are leading 43% of Americans to dine out less, with 75% of them trying to recreate restaurant-quality meals at home. Would that increase the niche of MAH (Make-at-Home) meals market?

In terms of grocery shopping, 73% of Americans are modifying their meat purchases to economize, primarily by adjusting the amount they buy. To save money, 30% of shoppers opt for smaller meat packages, while 42% purchase in bulk for long-term savings. Despite these cost-saving measures, over 90% of shoppers are willing to spend extra on meat for special occasions.

One last thing…

We all know how challenging is to secure viable and trustful LEADS… wouldn’t you agree?

3 ways MTH can help when You Ready:

✅Your Supply and Purchasing Advisor 1:1 (30 minutes Strategy Session)

✅I create a win-win partnership across the world with any brand, factory or new product

✅On-line/off-line Sales Training sessions to elevate your Global sales team (Check video for an example)