06/12/2004 
Bestmeat in Denmark: the two sides of the coin - A comment by Hans Aarestrup, Manager of Danske Svineproducenter
There has been no official confirmation so far of the news that a Danish slaughterhouse is intended to be taken over by the Dutch Bestmeat company, but indications intensify that Europe’s second largest slaughter company is not far from getting into Denmark.
But a question remains to be asked: Should Danske Svineproducenter, as the Danish pig producers’ representatives, be happy about finding a first serious competitor now on the Danish home market after many years? Or will Bestmeat rather cause trouble for the Danish pig industry and thus weaken our position on the European and global markets?
By having a share of 2 percent in all Danish slaughters, Bestmeat certainly won’t be in a position to exert biggest influence on prices. But there finally will be a way to compare Danish Crown’s activities with those of a competitor who must not be afraid of being swallowed by Danish Crown right away. This might bring fresh impetus for the industry but might also stimulate prices.
With regard to pigs, competition would finally get into being which might cause higher prices at last. According to the most recent price comparisons, buying pigs in Denmark means that 12 cents less per kg slaughter weight must be paid than must be in Germany. If those pigs could be sold to Germany in parts this would mean quite an important competitive advantage over German or Dutch slaughterhouses.
But what if there is a turn in the Euro - Dollar ratio and exports from the EU then become more lucrative? Subsequently, Danish pork would be very much demanded on the world market and prices for carcass pigs would exceed the European average prices. Then, supplying live pigs to Denmark would be a very interesting issue. And that’s what we have always tried to keep away from Denmark until this day. There would be much more of a danger to find epidemics be brought into Denmark than there is today. As could be observed in Holland several times, an outbreak of animal epidemics always ends up in quite a disaster in a country that depends on export so much.
Viewed in the short term, Bestmeat entering into the Danish market certainly produces advantages rather than disadvantages. But on a long-term basis, dangers will emerge that certainly must not be taken too lightly.
Unfortunately I cannot make a final assessment of the situation yet. When the time is right, we will see whether Bestmeat may be regarded as a premature Christmas gift or whether we rather have a Trojan horse here.
But a question remains to be asked: Should Danske Svineproducenter, as the Danish pig producers’ representatives, be happy about finding a first serious competitor now on the Danish home market after many years? Or will Bestmeat rather cause trouble for the Danish pig industry and thus weaken our position on the European and global markets?
By having a share of 2 percent in all Danish slaughters, Bestmeat certainly won’t be in a position to exert biggest influence on prices. But there finally will be a way to compare Danish Crown’s activities with those of a competitor who must not be afraid of being swallowed by Danish Crown right away. This might bring fresh impetus for the industry but might also stimulate prices.
With regard to pigs, competition would finally get into being which might cause higher prices at last. According to the most recent price comparisons, buying pigs in Denmark means that 12 cents less per kg slaughter weight must be paid than must be in Germany. If those pigs could be sold to Germany in parts this would mean quite an important competitive advantage over German or Dutch slaughterhouses.
But what if there is a turn in the Euro - Dollar ratio and exports from the EU then become more lucrative? Subsequently, Danish pork would be very much demanded on the world market and prices for carcass pigs would exceed the European average prices. Then, supplying live pigs to Denmark would be a very interesting issue. And that’s what we have always tried to keep away from Denmark until this day. There would be much more of a danger to find epidemics be brought into Denmark than there is today. As could be observed in Holland several times, an outbreak of animal epidemics always ends up in quite a disaster in a country that depends on export so much.
Viewed in the short term, Bestmeat entering into the Danish market certainly produces advantages rather than disadvantages. But on a long-term basis, dangers will emerge that certainly must not be taken too lightly.
Unfortunately I cannot make a final assessment of the situation yet. When the time is right, we will see whether Bestmeat may be regarded as a premature Christmas gift or whether we rather have a Trojan horse here.
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