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A Look At 2012 Prospects

05 January 2012

GERMANY - With agricultural markets favourable in 2011, the German Farmers' Association (Deutcher Bauernverband - DBV) looks over 2011 and the outlook for 2012.

Higher prices however did not mean better revenue, as grain harvests were low, pushing up feed prices.

Milk market

The past year has been a good one for the dairy industry. The milk market has finally stablised, leading to an increase of milk production (about 29.8 million tons).

The milk price is expected to remain steady at around �.35 cents per kg - which is parallel with rising milk prices and the growing cost of milk production.

For 2012, DBV expects the upward trend in the milk market to continue, despite an expected dip in milk prices paid at the start of the year.

Beef

Again producer prices have been strong. Prices for young bulls have been �.30 cents high than the previous year, and 40 cents higher than last year for cull cows.

Export opportunities have continued to develop in Turkey.

Retail prices of beef increased by 10 per cent, which did dampen some consumer spending.

DBV says that the price slump seen at the end of the year is a sort of acceptance that prices have reached a limit.

Pork

2011 pig slaughter is expected to break records, estimated at 59.3 million pigs. However future production looks limited.

The average 2011 price for hogs, based on grade E is expected to be �1.53 per kilogram, an increase of 11 cents compared to the previous year.

High feed prices are ultimately responsible for modest results in pig and piglet production. Higher producer prices are urgently needed in 2012, says DBV.

At an EU level, a significant decline in the sow inventory is recognised. If this continues there could be disastrous effects for EU pig production.

2012 will also be influenced by the conversion to group housing - which for many businesses will require significant investment.

Poultry

Consumption of poultry increased slightly in 2011, but was significantly weaker than in previous years. Over 2012 the sector will focus on export markets for poultry meat.

Eggs

After introducing an early ban on battery cages in 2010, Germany has seen its self-sufficiency in egg production fall 55 per cent.

With the introduction of the ban to the rest of the EU at the start of the month, German producers are hoping that they are in a better position to respond to the market.

The decisive factor of this though is whether the ban will be implemented consistently in member states.

Grain and oilseeds

Persistent drought and a rainy harvest meant it was a hard year for arable farmers. 41.4 million tons of grain were harvested - falling short of the multi-year average increase of nine per cent.

In 2012, producers are looking for a revival of trade. Prices are expected to remain high, due to strong global demand.

TheCropSite News Desk



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