CHALLENGES AND FORECASTS FOR THE MEAT INDUSTRY

From Boom to Crisis

Despite rising production costs and the loss of the Russian market, the meat industry was until recently one of the most profitable sectors of the food processing industry. The value of Polish meat exports in 2021 amounted to 7 billion euros. The year 2022 was far less generous, bringing many problems. Contributing factors included rampant inflation and the global crisis triggered, among other things, by the ongoing war in Ukraine. Meat production became less profitable at every stage following the crisis caused by energy supply disruptions. Everyone is feeling the strain: livestock farmers, slaughterhouses, as well as meat and cold cut producers.

A Shift in Trends Is Coming

One of the most important issues in this business is product safety and quality. Once associated with luxury, meat today is relatively cheap. This is the result of mass farming and the primacy of profit over quality. Poland is already in second place after Spain in antibiotic use in animal husbandry. Growing attention to quality, combined with the advancing climate crisis, is prompting consumers to give up meat in favour of plant-based alternatives. Other, increasingly conscious consumers are turning to artisanal products from small producers. This is why educating farmers, adhering to guidelines and recommendations, and factoring in rising veterinary inspection costs are all vitally important. The European Union wants to ban meat advertising in public spaces. Some cities have already adopted such measures. The Dutch city of Haarlem will become the first city in the world to ban the display of meat advertisements in public spaces in order to reduce consumption and greenhouse gas emissions. Climate activists and doctors are already urging people to reduce their consumption of meat, especially red meat. It is possible that in the near future meat may become altogether unpopular. Cage farming will be banned across the entire EU from 2027. This spells the end of immense suffering for pigs, chickens, calves and rabbits confined to cages, but the entire industry has had to face restructuring.

New Energy Sources and Resources

The meat industry is looking for solutions. In a position statement presented by the Union of Meat Industry Producers and Employers, the sector outlined its expectations. These include, among others, the possibility of co-financing investments in renewable energy sources from the state budget. A large part of the industry already makes use of such solutions, but their wider adoption and state co-financing would allow plants to achieve energy independence, which would at least partially offset — or fully replace — rising costs of other energy carriers.

Positive Changes

When it comes to employment conditions, the meat industry has changed significantly in recent years — says Damian Guzman, Deputy Director General at Gremi Personal employment agency, which specialises in recruiting workers from abroad. At the 2023 Meat & Plant-Based Alternatives Congress, he spoke about the impact of the war in Ukraine on the Polish labour market and the meat industry: "Workers who came to Poland looking for work 8-9 years ago did not want to work in the meat and fish industries. Nowadays, more and more people are willing to take up jobs in these sectors due to automation, improved working conditions and pay."

A Recipe for Reducing Turnover

58% of meat industry representatives believe there is a significant labour shortage on the market, and 65% of companies are struggling with high employee turnover — according to research by the Gremi Personal Analytics Centre conducted on a representative group of entrepreneurs managing large meat processing plants. How do you deal with this? An employee who trusts and likes their employer is more loyal and less inclined to look for a new job. How do we build such relationships? Gremi Personal specialises in bringing workers from Eastern Europe, and more recently also from Asia and South America. From the very beginning, we prioritise good relationships and support. We look after employees from the very first day of their stay in Poland. We help them adapt to new conditions. In addition, we run a loyalty programme, prepare gifts for the holidays, and organise events — and for the most talented children of our employees, we have a special scholarship programme. We also know that the market lacks male workers. That is why we seek people for work in new locations, inviting them from Asian countries and from South America. We take care of all the complications related to travel, permits, and the procedures for obtaining the necessary approvals.

Prepare for Seasonality

Given that 1/5 of processed meat products are produced for export (23% of companies export more than 50%), planning is crucial. Our internal research shows that the majority of companies (43%) declare a short planning horizon — up to six months. Gremi Personal research shows that only 1/5 of companies plan production several years ahead. Plants that plan years ahead should have reliable employees who do not change jobs mid-contract. This is where our outsourcing service comes in. We take on the risks associated with seasonality. If you need more hands, we'll provide them. If you face a production standstill, we'll simply reduce the number of workers. We handle all the formalities, moving people to other work and other tasks. Convenient, isn't it?

Find out more about our services and let's start working together!

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