When Will Retailers Pay Sustainable Prices?

UK - Pigs are getting in short supply, writes Peter Crichton in his latest Traffic Lights commentary.
calendar icon 3 May 2011
clock icon 3 minute read

Rather like skirts in the 1960s (remember?) pigs are getting shorter and at last, hopefully, some of the major retailers will pick up the message that unless they pay a sustainable price, this trend will continue and use-it-or-lose-it will apply.

Although the DAPP only moved up by a modest 0.76p and now stands at 141.62p, with the exception of Tulip who went up by 2p to 145p, Vion, Cranswick and Woodheads had yet to announce their weekly contract prices at the time this report was compiled. But this will still leave them well adrift of spot quotes which have now hit the 150p/kg mark with more available in places where buyers are short.

Soaring beef and lamb prices continue to make pork the third poor relation on supermarket shelves and the situation needs to be remedied, bearing in mind that pigs eat far more (expensive) food than their ruminant counterparts.

The relative strength of the euro which closed on Thursday (28 April) worth almost 89p has helped to maintain and in some cases improve cull sow quotes where there is now a more competitive market and delivered prices in the range of 110p to 112p per kilo are available for large loads meaning that those producers who are bold enough to cull and restock can probably exchange a cull sow for a replacement gilt.

The weaner market however remains in a negative situation as far as producers are concerned with the latest AHDB 30-kg ex-farm average of £43.75 per head still well behind productions costs but signs are emerging that weaner supplies will continue to get tighter which should help to lift the price at the finishers' expense.

Although feed wheat prices took a slight downwards step mid-week, the latest ex-farm feed wheat quote is still a touch above £200 per tonne and in the absence of any April showers, unless we have some early May rains these may come too late to revive flagging crops up the eastern side of the country.

With reports that some supermarket shelves have less pork on display than usual, hopes are rising that increased orders will continue to filter through to the abattoirs which will be reflected in further badly needed improvements in pigmeat prices, which are still in general terms well below CoP levels.

With most of the short weeks behind us normal trading should now resume and providing we see more of the mid-April sunny weather, barbeque demand could be further stimulated which will help the pig industry no end.

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