Currency Chaos Creates Uniform Market (August 2011)

By Chris Harris, Editor-in-Chief of ThePigSite. Our snapshot of the ongoing global pig industry trends as reported in the August 2011 Whole Hog Brief. To read the full detailed analysis, including all the commentary and graphical data, subscribe to the publication.
calendar icon 31 August 2011
clock icon 4 minute read

The current global financial crisis with debt in Europe and the deficit in the USA is having a strong effect on export markets.

According to the Whole Hog, an unintended consequence of the current global financial situation is that prices for pork exporters around the world are level pegging.

The Whole Hog says that at the moment, all the big players are having to pay the same price for their pigs.

The Whole Hog's global pig price cycle shows no signs of weakness.

Chinese pig prices are going through the roof but the global price index is just a few index points below the peak set in 1997.

The latest push is being led by the USA and Whole Hog says that this is now the longest period of week-to-week positive price changes.

EU Pig Producers Enjoy Price Recovery

Despite the sovereign debt crisis in Europe, pig producers have enjoyed a price recovery.

Prices had fallen back in June but bounced back in July but much will now depend on the European grain harvest.

The average EU pig price is €157.03 per 100kg – an increase of 5.3 per cent on July last year, according to the Whole Hog.

The recently released Eurostat farm income report for 2009-2010 shows an increase of 12.6 per cent in the EU in 2010, following a fall of 10 per cent the previous year.

For livestock farmers, output rose in 2010 but income fell by 1.9 per cent compared to 2009.

Danish Breeding Herd Takes Another Dive

The July pig census figures from the Danish Statistics office show drop in the total number of pigs of 0.2 per cent.

According to the Whole Hog the sow herd fell by 3.2 per cent and the number of sows to farrow was down by three per cent.

However, the number of pigs for slaughter rose by 5.6 per cent.

Data gathered by the Whole Hog for the Spanish market show that high feed prices have squeezed the sector and the breeding herd has fallen by 1.3 per cent at 2.41 million head.

The data also shows that the number of farms is in decline, with the total falling by more than 60 per cent in the decade between 1999 and 2009.

Canada's Pork Exports Held Back by Availability

While Canada's pig meat exports for the first five months of the year were booming, the contraction of the herd in previous years has meant that availability of product is poor.

By the end of May, pig meat exports were up by just 0.2 per cent. Live exports were showing a rise – up by 1.4 per cent.

Pork exports from the USA grew strongly and stocks are up, according to Whole Hog. Exports have shown a rise of 17 per cent in the first five months of the year compared to 2010.

Whole Hog says that domestic hog prices have risen to record highs and this is because of the increase in exports. The May figures for pig meat exports show a 12 per cent rise on the same month in 2010.

Figures for the first five months of the year show a continued fall in the amount of imports of pig meat into Australia.

Imports fell by 6.9 per cent over the period while exports were up by 6.2 per cent.

Whole Hog shows that while the Japanese market is growing, it is not at a great rate for those countries exporting to the country.

The June figures show a three per cent increase in the year to date compared with June 2010.

In South Korea, the figures for the half-year point to record pig meat imports. The market is being driven not only by the FMD outbreak but also a reduction in tariff rate quotas and a suspension of all tariffs on pork for processing until the end of September.

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