Animal Conservation

Kay’s Cuts: The Spanish Meat Industry’s $3.65 Billion Effort Towards Better Animal Welfare and Sustainability

A monthly column written on the global beef trade by Steve Kay, editor of US Cattle Buyers Weekly

I have just returned from a ten day trip to Spain, one of my favorite countries to visit in Europe.

I stayed mostly in Barcelona and once again enjoyed its beauty, culture, food and more. I also took a two-day trip to the foothills of the Pyrenees, where I saw up close both the beautiful countryside filled with pastures and dense green forests, but also the Spanish cattle industry.

Driving through the area, I saw many herds of beef cattle, some of which appeared to be Charolais, but were more likely to be one of the 49 native beef breeds that Spain has.

I saw thousands of round hay bales standing in what were often just fields no larger than two acres. I also saw state-of-the-art feeder barns up close, the roofs of which no doubt offered respite to cattle from the scorching sun.

I won’t pretend to draw any conclusions after what was only a brief overview, but it appeared that the Spanish cattle and beef industry is thriving and is an important part of the country’s overall economy. But he is also in transition.

In a recent report, the USDA said that after years of increasing animal protein production, Spain is now taking a different approach to its livestock sector.

The strategy of the Spanish livestock sector is now focused on a more controlled expansion and diversification of export markets.

The entire Spanish meat sector, including cattle and pigs, is ready to invest around $3.63 billion, partly through the European Union’s Next Generation funds, to improve welfare. being animal, sustainability, efficiency and modernizing the sector.

Spanish livestock production contributes more than US$17 billion to the country’s agricultural production, while the country’s meat industry has a turnover of more than US$30 billion, according to the USDA.

This represents 22.6% of the total Spanish food industry, making it the leading sector with exports of $10.4 billion.

Shrinking livestock stocks

However, the new approach could lead to shrinking livestock inventories for 2022 as producers seek to minimize environmental impact and find alternative export markets to China.

Rubia Gallega cattle, one of many Spanish heritage meat breeds

In 2020, official Spanish data for cattle and beef showed a slight drop in production due to the COVID pandemic and rising feed prices. In 2020, Spanish cattle slaughter fell by 3.5% to 2.4 million animals. Spanish beef production also fell by 2.6% to 677,740 tons, while carcass weight increased by 1% to 279.5 kg due to delays in slaughter due to the closure of the hotel sector.

According to the sector, cattle slaughter in Spain is likely to have decreased by 2.4% in 2021, mainly due to a reduction in calf slaughter, and by 3.5% in 2022 due to weak economic performance and the intention of Spanish breeders to reduce their production.

Spanish cattle herd ending stocks for 2022 could fall by 1.1%, according to the USDA. In 2020, beef exports from Spain increased by 4% to reach 231,000 t and $903 million, mainly fueled by an 8% increase in exports to the EU, in particular to Italy and the Greece. This level of exports and a decrease in imports led to the second positive trade balance since 2000 of $289 million. This positive trend continued from January to July 2021.

In 2020, Spain exported 85% of its beef to other EU member states, mostly to Mediterranean countries, according to the USDA.

China and South Korea export targets

Since 2020, Spanish beef exports have seen significant increases to Canada, Indonesia, Vietnam and Hong Kong. According to the Spanish beef industry, in 2020 Spanish beef exports saw a shift in trade flows from North Africa to new markets.

Moreover, the Spanish beef sector is still working to open up China and South Korea. According to industry sources, Spanish beef exports to non-EU markets are expected to rebound to normal levels in 2021, continuing their positive trend in 2022, according to the USDA.

Exports are therefore the cornerstone of the Spanish beef industry, as they are for Australia.

Increase in US exports

In contrast, US beef exports represent only 15-17% of total production. But they are also important for the health of the industry.

Unlike Australia’s faltering exports, US exports have soared so far this year and maintained their stellar performance in May and June, with no signs of slowing down despite ongoing difficulties.

Exports set new records in volume and value, exceeding US$1 billion for the fourth time this year.

U.S. beef exports in May reached 135,000 t, up 1% from the previous record in May 2021. Export value climbed 20% to $1.09 billion, breaking the March record 2022. From January to May, beef exports increased by 4% compared to a year ago to reach 613,266 t, valued at US$5.14 billion (up 34%).

More importantly, the value of beef exports in May averaged US$505 per slaughter head, up 17% from a year ago, breaking the previous record high of US$503. US dollars established in January 2022, according to USMEF. Through May, the per capita export value averaged $483.49, up 34% from the first five months of 2021. That’s how important our exports are.