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At Times Like This, You Know Who Your Friends Are

by 5m Editor
2 August 2010, at 9:54am

UK - Demand for contract and spot pigs remained rather subdued today with most abattoirs blaming indifferent demand from the retail sector at a time when there are perhaps just a few more pigs on offer than they really need, writes Peter Crichton.

Although there were no reports of any large numbers of pigs being held over, general price trends tended to be more of a negative than a positive stand-on, with spot bacon selling at around the 140p mark and at times like this you know who your friends are (or are not).

Lighter pigs continue to earn modest premiums, but when compared with beef and lamb pork is still extremely good value and it is just a pity that demand at the retail end still seems to be on the flat side and perhaps those who voted in favour of Jimmy Butler's plea for more money being spent on pigmeat promotion might be proved right.

The euro has also followed a rather lacklustre path recently and closed on Friday at 83.1p which is almost 0.5p lower than its value a week ago, indicating that currency traders have probably marginally more confidence in the pound than the euro.

Cull sow prices remain within a fairly wide range depending on load size and region with but leading quotes were around 100p/kg on a delivered basis, but for those with smaller numbers or further distances to travel bids in the 94–97p area were available.

The price of feed remains a major talking point, which after a further volatile week has seen off the combine prices for wheat of over £130/tonne and delivered quotes nudging up towards £140/tonne.

Some pundits feel that the market is being lifted more by speculators than raw material users and once the combines get into the United Kingdom wheat harvest prices might perhaps either ease or hit a plateau, but there is no doubt that producers will face significantly increased production costs in the months ahead compared with a year ago.

One thing everyone (apart from arable farmers) wants to avoid is a repeat of the situation in 2007 when we saw wheat prices zoom up towards £180/tonne and several pig producers head for the exit door including some spectacular liquidations.

Disease also remains a significant challenge in the industry as a whole and a significant number of the dysentery outbreaks that have affected East Anglian and Yorkshire producers can be traced back to inadequate or incomplete wagon washing with inadequate disinfection at abattoirs. This is not helped by the pressures of time that hauliers have to work under and reports of inadequate washing and disinfection facilities as some (but not all) plants.

Abattoirs need to recognise that they have a vital part to play in the food supply chain and it is essential that the British pig herd remains healthy, so wherever possible the lorry wash should be treated as a priority and not somewhere round the back with a trickling hose attached to a hungry slot machine and a timer!