ThePigSite.com - news, features, articles and disease information for the swine industry

News

Pig Prices Ease but Remain Higher than 2016, Reports QMS

31 July 2017

EU - European farm gate pig prices remain some seven per cent higher than they were a year ago, despite dipping in recent weeks, according to Quality Meat Scotland.

Major northern producers such as Germany, Denmark and the Netherlands have all seen producer returns fall in recent weeks. In contrast Spain and Italy, which have a seasonal influx of tourists, have seen prices stabilise or climb slightly.

European farm gate prices often plateau through the summer holidays before dipping in late September so this earlier dip in price may flag some changes in the supply and demand balance across Europe.

European Union production has been increasing seasonally and although currently at similar levels to last year, is forecast to be higher than 2016 in the final quarter of 2017.

European trade data shows a slowdown in exports which will have left more production on the European market. Trade data for the first third of 2017 shows European pigmeat exports dipping around six per cent, with the significant 23 per cent decline in EU exports to China not being offset by growth in trade to Japan, South Korea and the Philippines.

Chinese trade data reported an overall decline of 23 per cent in their imports during May and Chinese wholesale pigmeat prices have fallen around 20 per cent since the Chinese New Year at the start of February.

Consequently, with a slightly better supplied market and lower Chinese demand leading to more competition in export markets, European producer prices have started to come under some pressure.

In contrast, although the rate of increase has slowed, UK and Scottish pig producers are still seeing some increase in farmgate prices with current prices some 28 per cent higher than a year ago.

On a Euro basis UK prices are 23 per cent higher than a year ago and the UK price has gone from nine per cent below the EU average a year ago to six per cent above it currently. This, once again, opens up the prospect of pork imports from the EU becoming attractive.

However because UK prices are now higher than the EU average, the attraction of exporting to Europe, despite the weakness of Sterling, is reduced. Most notable this has led to some pressure on sow prices because the German market is an important outlet for UK sow meat. Unlike mainland Europe, the UK has continued to see some growth in pigmeat exports to China and Hong Kong.

Several UK pig abattoir operators continue to express a view that they could handle more pigs as demand for pork-based products remains firm. Indeed, UK weekly pig slaughterings have been lower than last year for some time with May and June slaughterings some 2.5 per cent lower than in 2016 and throughputs at price-reporting abattoirs suggest that decline in numbers has continued into July. However, with carcase weights reported to be slightly heavier, UK production has not fallen as much.

Looking ahead, while UK pig producers are continuing to benefit from firm demand and prices, the longer-term outlook looks set to be more challenging and farm gate prices may start coming under pressure.

ThePigSite News Desk

Top image via Shutterstock



Share This

News By

Related News

More News

New Genesus corporate video

News from United States   25 September 2017

Our Sponsors

Partners


Seasonal Picks

The Commuter Pig Keeper - 5m Books