Pig Prices in Retreat in Almost Every Sector

by 5m Editor
8 August 2011, at 8:58am

UK - Not quite as depressing as the stock market has been in the last 48 hours, but pig prices are also in retreat in almost every sector, writes Peter Crichton.

Although the DAPP only fell by a relatively modest 0.44p and now stands at 151.90p, weekly shout prices dropped between 1p–2p and earlier promises that self-set shout prices would "reflect the DAPP" were proved to be incorrect. They are now an average 5.28p below the DAPP... but are we surprised?

The latest positions in the contract price league table are as follows:

Woodhead 149p — Premiership
Tulip 147p — Championship
Cranswick 145.5p — League 1
Vion 145p — Doc Martens

The spot market proved to be an even unhappier location with some bids as low as 140p being accepted by sellers who had no other homes to go to, but in the main regular spot sellers were treated a little better with quotes in the 144p region available and more in places.

The recent turmoil in some of those European countries where hot and shifty people tend to live saw a further 1.2 percent wiped off the value of the euro over the week. The euro closed on Friday worth 86.6p.

The cull sow sector provided some stability with quotes at largely stand-on levels and a slight shortage of sows coupled with extra competition has helped to keep quotes on a even keel with ex-farm quotes around 100p–102p and delivered prices 2p–4p ahead of this, but there are concerns that unless the viability of the pig industry improves as a whole (and this seems unlikely between now and the end of the year) cull sow slaughtering could pick up to the determent of the industry as a whole.

Weaner prices are continuing to slip with the latest Agriculture and Horticulture Development Board 30kg ex-farm average below 345.00/head for the first time for a while, but this includes a significant proportion of contract based weaner deals, whereas the spot weaner market was almost friendless with bids as low as 340/head for 30kg weaners being heard in some sectors wi th space remaining at a premium.

With a stop-start harvest underway grain quality is reported to be inferior in some regions and forward quotes are showing a very slightly easier trend with November wheat now at 3160/t, but compared to the price of pigmeat feed is still 20 percent too dear for farmers to break even.

It is difficult to see anything but darkness at the end of the current pig market tunnel until we move into 2012 and the underlying problem is that United Kingdom pigmeat, because of its higher production costs, is still uncompetitive when compared with foreign imports.

If the European turmoil continues leading to a weaker euro, this could make a bad position worse. All in all another week best forgotten, even for those with wedding anniversaries to try and remember.