Meat to remain one of the pillars for economic recovery
The Spanish meat industry has increased its exports, which has made it possible to resist the impact of COVID-19 and maintain investment plans. This is the main conclusion of the fifth edition of the 'Barometer of the Spanish meat industry' prepared by ANICE and the Cajamar Cooperative Bank.
The Barometer, quoted by the Carnica magazine, also show that 75% of companies consider that during the first half of the year the economic situation of the sector worsened, although a slight improvement was expected in the last quarter. According to the work prepared by the bank and the National Association of Meat Industries of Spain, exporting companies are suffering less intensely from this crisis, as they have alternatives to the national market, so they hope to maintain the current sales volume.
"Although the impact of the crisis on the economy will be enormous, the meat industry will be one of the most prominent sectors in the economic recovery, thanks to the exports, which have not stopped growing; to the dynamism and professionalization of the industry, which has been demonstrating its ability to adapt to the different situations it has gone through in recent decades; as well as the measures and investments they are promoting to improve their sustainability," considers Eduardo Baamonde, president of the Cajamar bank.
Barometer data show that, during the first half of the year, only 14.3% of companies in the sector managed to increase their sales, compared to 65.7% that reduced their turnover.
However, expectations regarding the second half of the year improve slightly, although pessimism about the evolution of turnover remains at 62.9%. Keep in mind that the survey was conducted during the summer when the situation regarding COVID-19 was less critical. If the survey were done now, after the new measures taken by the central and regional governments, the opinions would predictably be more pessimistic.
On the other hand, it is important to note that the weakness of demand, mentioned by 68.6% of the companies in the survey, and the increase in competition (60%) are once again gaining importance as the most limiting factors for the good march of the Spanish meat industry. The percentage of exporting companies in the meat industry has not suffered a decrease in the first half of the year, although a slight reduction is expected by the end of the year, still remaining above 70%.
Regarding the volume of sales abroad, companies mostly consider that they will maintain the current one (48%). Despite the difficulties of the moment, which range from the production process itself to the transport logistics, Spanish meat companies identify this period as a temporary bump in their export trajectory, while at the same time they consider themselves capable of maintaining their position in foreign markets.
although the agri-food sector has been affected somewhat less intensely since it is not forced to close it completely, the situation in certain sectors of activity, within the meat sector, closely linked to the Horeca channel, can be considered worrying. This is the case of the Iberian pork sector and beef and sheep meat.
Nevertheless, 23% of the companies surveyed believe that the changes produced during these months will be reversed, as the effects of the pandemic are left behind. Even a majority - 77% - consider that some changes are here to stay, while 14% believe that their depth is so great that the future will be radically different. More than 80% of companies believe that digitization is here to stay, as well as 77% foresee a greater role for electronic commerce and tighter consumer price levels. Likewise, 59% of the companies surveyed consider that the consumer will be more concerned about food safety and the relationship between health and nutrition.
Finally, regarding the impact of COVID-19 in various variables in terms of meat and meat products, the companies highlight that sales, the cost of raw materials, exports, as well as the cost of energy have been reduced. On the contrary, order cancellations, financial costs, logistics and brand image have increased.
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