Hungary Newsflash Week 12, 2022

Rising chicken egg prices on the market, cereal exports remain mostly uninterrupted, meat sector trends continue in which pork and beef declines while chicken rises, and the drought becomes severe enough for the official announcement of a water-stressed period - The week in Hungarian agriculture

Artistic picture of the rising sun with its beams breaking through a grove of trees nearby a dry meadow
Beeld: ©Molnár Bálint
Hungary might be looking at a particularly dry year as on March 22, on World Water Day, the government has officially announced a prolonged water-stressed period in the country.

Egg prices will go up in the coming period

A recent analysis by the portal Agroinform has found that egg prices will soon start increasing in Hungary, and will have reached an average €0.15/piece consumer price by Easter.

This is due to increased animal feed, energy and labor prices but a potential ban on cage farming will also increase costs.

According to the analysis, in Q4, 2021, animal feed input costs in egg farming have gone up by 40% y-o-y, yet farmers were unable to build this cost increase into their pricing strategy and the producer price of eggs only increased by 16%, to a total of €0.076/piece. Due to the aforementioned increases of energy and labor costs, the majority of Hungary’s 550 egg producers have seen their profits cut almost to breaking even.

Hungary produced around 1.27 billion chicken eggs in 2021, 16% more than in 2020. Around 20-25% of the eggs circulating on the market in Hungary are imported.

Györgyi Molnár, secretary of the industrial alliance of the country’s egg producers has told the agriculture press that due to a drop in the import supply – Caused by Avian influenza outbreaks in France and the war in Ukraine – traders are now agreeable to offer a higher, €0.11/piece producer price for eggs, which the producers claim are needed for the long-term stability of the sector.

Based on the latest statistics, Hungarians consume 240 chicken eggs per capita in a year.

Cereal exports, for the most part, continue uninterrupted

The news portal Agrárszektor writes that more than 80% of traders report that their delivery of cereal has been uninterrupted by the government’s export control measures.

We have reported on the control measures that the Hungarian government has introduced on March 6. The government claims that these measures were put into place in order to keep Hungary’s cereal within the country while international prices are skyrocketing due to the war in Ukraine.

The news portal also adds that most traders have experienced very short waiting times for the processing of their export notifications and that usually the Ministry of Agriculture replies “within a day.”

The cereal export control measure, as it stands, covers wheat, barley, rye, oats, sunflower and soy. Traders who want to export these cereals have to register a notification with the authorities, who can decide to stop the shipment and buy up the cargo at market price instead.

Wheat field in sunshine
Beeld: ©PicJumbo
Agricultural news in Hungary report that most traders have been able to continue their cereal exports mostly uninterrupted since the government's introduction of the cereal export control measures.

Drought officially announced

On Monday, March 22, the Minister for Interior has announced a “prolonged water-stressed period” in Hungary. Ironically, March 22 is World Water Day.

Current data by the National Meteorological Service (OMSZ) suggests that soils have dried further in Hungary in the end of winter and the beginning of spring and the top 20-centimeter layer of the topsoil now has under 40% humidity in almost the entire territory of the country.

Legally, in a prolonged water-stressed period, farmers are entitled to a one-time special water usage for irrigation without notifying the authorities and water licensing.

This special water usage can be the usage of surface water, with temporary pumping, with a limit of 1200 m3 per hectare, for a total of 100 hectares, for a period of one month in total (without interruptions). Mobile, tractor-drawn irrigation units can be used for this purpose.

Meat sector: Pig, sheep and cattle figures decline, chicken population grows

The Central Statistical Office (KSH) has published an overview of Hungary’s animal husbandry figures from last December. The report states that the pig livestock decreased by 4.4% y-o-y in December, 2021, and while the populations of cattle and sheep decreased by 3.3% and 6%, respectively, the number of chickens increased by 11%.

Last Friday we have reported on the two-decade decline of Hungary’s pig sector. This week’s figures show that the average price of pigs for slaughter were €1.04 in December, which is a 12% y-o-y decline and the lowest figure in the last twelve years. Out of the total pig livestock population of 2.7 million, the number of sows decreased by 4.1% to 157 thousand.

Slaughterhouse figures correlate with these numbers, in total, 5 million pigs were slaughtered in Hungary in 2021, which is a 4.1% increase from 2020 and the number of slaughtered sows increased by 17%, which is a sign of farm closures.

The export of pork also increased, by 8.5%, to 149.4 thousand tons.

The cattle population follows similar trends. In 2021, 115 thousand heads of cattle were slaughtered, which is 3.6% or 4 thousand heads more than in 2020. Out of this, the ratio of cows did not change, however, the ratio of young animals and calves went up. The export of live cattle increased last year, by 22%, to 69.7 thousand tons, and the volume of beef exports also increased by 12%, while imports fell by 18%.

The sheep population continued its slow decline. By December, the sheep livestock population decreased by 6% to 887 thousand. The price and the quantity of sheep for slaughter increased by 21% and 3.8%, respectively.

The number of chickens in Hungary increased to 32.1 million in 2021, which is an 11% increase from the previous year. The price of chickens for slaughter also went up by 13%, and the quantity increased as well, to 174 million, which is a 5% increase.

The number of ducks and geese increased as well, by 43% and 19%, respectively. The duck livestock population was 4.2 million heads, the population of geese was 952 thousand.

The number of turkeys decreased though, by 3.8%, to 2.6 million.