A Sweet and Sour Pork Day

UK - Rather like a Chinese meal which "fills you up and leaves you empty", trading today was not particularly satisfying for sellers and no real bite has yet emerged in the market, which normally happens in late September once the holiday period is well and truly over, writes Peter Crichton in his Traffic Lights commentary.
calendar icon 19 September 2009
clock icon 4 minute read

Probably the main culprits in the supply/demand equation are the retailers who are taking advantage of low European Union pigment prices and buying rising volumes of imports rather than supporting the domestic product.

Although the DAPP has hardly moved, shedding 0.01p to close at 150.55p, this is still approximately 10p above equivalent spot quotes where space continues to be in short supply.

Lighter pigs continue to earn a modest premium of 4–6p above bacon and if the current spell of warmer weather continues (in East Anglia) we could even see some barbecues back on the nation’s patios again.

One other bright spot has been the recent strength of the euro which has proved many of the so called experts wrong and has staged a significant rally rising by 3.4 per cent over the past seven days to stand at 90.4p at close of business on Friday.

If it had not been for this rise, imported pigmeat would have been even cheaper and pose more of a threat, but it is still niggling away at the United Kingdom market.

European cull sow prices have fallen fairly sharply this week with German factories offering 6 cents less than last week, the equivalent to a fall of just over 5p in value, but once the rise of the euro is taken into account this resulted in cull sow export abattoirs dropping their bids by around 2-3p/kg with quotes in the 110–114p range, but the usual premiums available for larger loads.

Weaner prices have also been slightly undermined by the unsettled outlook for finished pig prices this autumn, also bearing in mind that today’s weaner becomes a baconer on something like Christmas Eve which is never normally a good time to be selling finishers, especially on the spot market.

The latest AHDB 30kg ex-farm average is quoted at 353.07/head, but still no great surplus of weaners in the system which should help to put a bottom in the market.

On the feed price front very little has changed, although wheat was traded marginally dearer on an ex-farm basis this week at 385/t, but barley remains a relative bargain at 372/t.

The provisional results of the June 2009 pig census makes slightly more encouraging reading than usual showing a 5.5 per cent rise in the number of breeding pigs in the English herd over the last 12 months, but this is still much lower than the June 2007 and earlier figures.

Some of the glass half empty merchants might feel that this flags up bad news for the British pig industry with supplies going up, but because the overall size of the British pig herd has shrunk to little more than 3 per cent over the European Union total herd, we need to have a larger position in the market to keep all the allied trade, processors and supply chain links in place rather than being overwhelmed to an even greater extent by yet more imports.

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