The European red meat sector faces a gloomy future of declining consumption and production, a Rabobank report on the global protein industry has warned. There would be a fall in both the consumption and production of beef in the EU over the next decade, the report predicted. Consumption was expected to dip from 8.5m tonnes last year to 8.3m tonnes by 2014, while production would decrease from 8m tonnes to 7.6m tonnes.

The fall in production would be the result of a decline in the size of dairy cow herds, according to Rabobank. Beef producers were also abandoning production due to CAP reforms eroding financial incentives for farmers, the financial specialist said.

To help meet the shortage,total EU beef imports would rise to 740,000 tonnes by the end of 2014, Rabobank predicted, with EU exports falling to less than 50,000 tonnes. A similar outlook was likely for pork as a result of a further decline in the sow herd, although the report did predict that 2009 would see an equilibrium reached where increased production costs would finally be met by retail price hikes. The report examined the effect of rising commodity prices on the global production of salmon, beef, pork, poultry, vannamei shrimp and pangasius.

Of the six industries studied, the Norwegian salmon industry was least affected by rising costs, thanks to the low amounts of costly oilseed and grain included in salmon feed, coupled with stable fishmeal prices. By contrast, high feed costs had been particularly damaging to the Vietnamese pangasius and EU pork sectors.