News: Greater Europe
In an effort to increase awareness of U.S. Soy and demonstrate commitment to the growing swine industry customers from Romania, a group of technical experts visited with pig integrations on behalf of USSEC during the third week of April. The goal of the mission was to understand the past years’ developments in the Romanian swine sector and to offer technical support in pig nutrition, feeding and management to fast-developing swine integrations. With a pork meat consumption of 20 kilograms (kg) per capita, Romania is way under the European average of 46.4 kg per capita, which paves the way for an increase in pork consumption in the coming years.
Due to similarities in the industry’s development stages and taking into account the leading role and expertise of Spain among the EU and world pig meat production, USSEC invited high profile experts Dr. Josep Gasa, professor of Animal Science at University Autonomous of Barcelona and Dr. Gonzalo Mateos, professor at the Universidad Politécnica de Madrid, for onsite technical training for swine farm managers, nutritionists and production staff.
Field visits organized at two swine integrations and one fattening farm facilitated interactions with farm managers and feed specialists. USSEC experts learned from discussions that after a period of stagnation, the swine industry showed a constant increase for the past four years and reached a point where the local breeding farms are not able to supply the rapidly increasing piglets’ demand from the pig fattening farmers. Swine breeding farms are currently established through local or foreign investments and receive strong support from EU funding.
“Due to the rapid development, there is a shortage of qualified personnel at the level of the newly established sow farms, where the required level of technical skills is much higher than the qualification needed for fattening pigs,” said Dr. Mateos. “As one of the top EU grain producers, Romania’s annual production is around 20 million tons; out of this, 60 percent is exported as raw materials to Western European or Middle Eastern countries. Due to the increasing availability of grains, the meat production should expand and this offers excellent opportunities to the Romanian swine industry. However, the feed and livestock industries are confronted with the availability of high quality vegetal protein sources, among these, soybean meal is the main quality protein used in animal feeds. This challenge should be answered by keeping a constant supply of U.S. Soy for the Romanian feed industry,” Dr. Mateos added.
Even if still fragmented, the pork meat production in Romania is the largest and most important sector of livestock production in the country, while the commercial swine industry consumes more than 43 percent from the total industrial feed compound manufactured in the country.
Besides the predicted increase in local consumption, pork meat exports are expected to increase steadily in the coming years, which will reinforce Romania’s position as one of Europe’s top agriculture and livestock producing countries and, indeed, as an increasing market for U.S. Soy.
Grain and oilseed/protein traders and purchasing officers from compound feed industry from Eastern Europe gathered in Warsaw, Poland in May for USSEC’s International Trade Risk Management Workshop. While most of the audience represented Poland, there were also customers from the Czech Republic, Hungary, Romania, Bulgaria, and Serbia.
Jay O’Neil, International Grain Program, Kansas State University, laid the foundation for the training event by presenting about U.S. grain and soy production and the marketing system. Then he explained the relationship between cash markets and futures, trading terminology and definitions, and how to read the futures prices and determine carry versus inverse markets.
Bob Bresnahan, Trilateral Inc., Chicago, introduced the audience to the Chicago Board of Trade (CBOT) as a clearing house and counter party risk to later move to fundamental analysis and technical analysis. He next focused on where and how to hedge and principals of futures and options trading.
On the second day of the workshop, the customers were given some examples of hedging for traders and producers and end users that allowed them to better understand how to apply what they were learning. Different trading strategies for different market conditions were also explained to them.
Jerzy W. Kosieradzki, USSEC Technical Director – Northeastern Europe, made the audience aware of the importance of sustainable food production to consumers in Western hemisphere and pointed out that U.S. Soy’s production system sets global standard in this respect. He also spoke on the U.S. Soy Sustainability Assurance Protocol (SSAP) certificates that are available to U.S. soybean and soy products importers that do not carry any extra cost to them.
The risk management workshop finished with a round of questions and answers and comments and the students were presented with their certificates of completion.
Eszter Magyari of Cargill-Hungary in Budapest shared that once she had attended a training course on managing risk in international trade organized for Cargill staff, but the USSEC workshop gave her a much deeper and more practical insight into these professional issues. A thank you call from Marek Brzozowski, Bunge-Poland’s commercial manager, whose staff members came back from Warsaw truly thrilled with the quality of know-how they received at the USSEC workshop, was a special reward.