Pig livestock in Ukraine to shrink to historic minimum – analyst

"We have repeatedly heard that the pig population in the country in the beginning of 2017 turned out to be the smallest in nearly a decade. It's interesting how things are happening right now. First, I'd like to mention that the situation has even worsened, that is, the livestock has continued to decrease," Liga.net quoted the expert as saying.

In fact, since the beginning of the year, the livestock has slightly grown, but due to seasonal fluctuations, it makes sense to compare it only with the corresponding month of last year. And the slowdown from last year's indicators as of October 1 has already hit 9.3% (6.762 million head against 7.4454 million), whereas the difference was 5.8% as of January 1.

"The largest reduction was reported by agri-businesses. The number of pigs was 10.1% down on October year-over-year (3.427 million head against 3.814 million), while the decline was only 3.7% at the beginning of the year. There are many factors that affected the situation: African swine fever (ASF) outbreaks, the last year's low profitability which consequences became apparent in full, quite high prices of live weight which encouraged the sales, as well as the repair of facilities and the update of livestock immediately at several large-sized enterprises," Pankratov said.

The reduction of the pig livestock in the households is not accelerating, while the trend of the last seven years continues. On October 1, the difference with the previous year was 8.4% (3.334 million head against 3.639 million), and it was not much less on January 1, namely 8.1%.

Read alsoBelarus limits pork imports from Ukraine's Zhytomyr region because of ASFThe share of livestock in agri-businesses on October 1 stood at 50.7%, which was slightly down on last year (51.2%), but still above the half mark, the expert noted.

"... The tendency of reducing the number of pigs in the households is continuing and it almost does not react to the temporary market factors, that is, it is evolutionary. However, the professional pig-breeding sector is rather sensitive to changes in the profitability and business risks, and is showing a rather logical and predictable response. The reaction is somewhat belated so far. For example, the peak of prices in the EU was registered earlier and the corresponding increase in production occurred more quickly, but we also have the signs of a stable market," Pankratov said.

Thus, despite all the risks associated with ASF, one can expect that the professional pig-breeding sector will show the growth of the livestock already in the coming months, as the profitability of the business has improved significantly, and is now the highest in the last three years. More precisely, it will reduce the lag from last year, given the seasonal tendency to a decline at this period of time, according to the expert.

"At the same time, it's unrealistic to cover the decline in the livestock in the households so far, and the total number of pigs at the beginning of next year is expected to be the lowest in Ukraine's current history at the level of 6.1 million head, according to our estimates," Pankratov added.