The future of beef in Romania, predictions about the beef industry
The outlook for the beef industry is positive. The world population is growing exponentially, so an increase in demand for beef is expected, especially in the developing countries of the Far East.
Romania, through the potential of grazing land and breeding of beef cattle in an extensive system, is ideally placed to respond to these signals of the market in vogue. Romanian farmers have the capacity to sustainably increase production in order to meet global demand. The Aberdeen Angus cattle farms in Romania can produce quality beef in a responsible manner regarding animal welfare and environment protection.
Despite recent increases in meat prices and a better outlook in the medium term, there are still challenges for the beef industry such as the economy of production, changing regulations at European Union level, managing animal health and welfare standards, or the natural environment protection.
The factors that will shape the general future of the zootechnical industry in Romania are related to the demands of the global market, suppliers and customers, the challenges for animal health and environmental policy factors that will all play a role in the management of the sector. It is impossible to predict exactly what form these challenges will take, but studies conducted in 2019 make the following forecasts:
- The world population will grow, the United Nations estimates that we will have to feed an additional 761 million people between 2010 and 2020.
- Global demand for beef will increase with consumption per capita. OECD-FAO forecasts indicate a 5% increase in beef consumption by 2020, with world consumption increasing by 14% and in developing countries by 18%.
- Without other force majeure situations, prices should remain firm compared to historical levels. Current deliveries of beef are few in the world markets.
- Trade liberalization means that export opportunities will continue to diversify. Beef exports have more than doubled in the last two years with EU countries taking the majority of beef from Romania; in any case, exports to third countries present strong opportunities as they have the potential to increase their value.
- The domestic consumption of red meat has increased exponentially in the last year, as a result of the changes in lifestyle and the consumers’ attention for natural products from a controlled environment, but also with a focus on reduced quantity and higher quality.
- The farm input costs will remain a challenge, despite the subsequent better returns, the production costs of the farms have increased in recent years and are expected to remain at a high level in the near future.
- Lack of predictability of state aid and of the European Union, which will place more emphasis on environmental obligations, production systems and traceability.
- New diseases will appear at the level of animal husbandry that will put pressure on the agricultural margins. Disease surveillance and endemic disease eradication programs will be critical to ensuring a healthy future for beef production in Romania.