Extra Supply Sees Prices Ease

19 December 2011, at 9:51am

Contract sellers enjoyed a slightly easier day than spot with the DAPP rising by a further 0.33p and all of the shout prices following Tulip's lead and standing-on, writes Peter Crichton in his Traffic Lights's commentary for 16 December.

Although spot buyers were fairly active earlier in the week, by the time Friday dawned with extra pigs available due to the two upcoming short weeks, prices unsurprisingly eased.

Although some early bird sellers were still able to agree prices in the 150p region, later in the day some spot buyers dropped their quotes as low as 144p and rather than stockpile pigs over the Christmas period, sellers elected to have a deal at this level to clear the decks ready for the New Year.

Demand for lighter weight cutters also proved to be slightly fickle, although we often see a last minute upturn in demand a few days before Christmas.

The shout price advent calendar therefore remains as follows:

Still equal first, Gills and Woodhead, 148p.
Next Tulip, 146p.
Still last Cranswick and Vion, 144p.

Cull sow prices have also been affected by the upcoming holiday and weak performance of the euro which on Friday afternoon was trading in the 84p region.

Because of this and the European holiday as well as two short slaughtering weeks, cull sow buyers were spoilt for choice and prices dropped from 2p–4p with sellers of large loads generally able to negotiate prices in the 114p–117p range according to specification, but ex-farm quotes as low as 111p were heard in some quarters.

Weaner prices however continue to rally, reflecting a much more optimistic outlook for pig prices in 10–12 weeks' time and the Agriculture and Horticulture Development Board 30kg ex-farm weaner average continues to climb and has now hit £44.03/head, but most spot weaners were traded at slightly higher levels and Freedom Food weaners were earning premiums of £2-£4 above this.

Cereal prices have remained largely unchanged this week with the latest ex-farm feed wheat quote holding steady at £136/onnet and LIFFE futures prices from January through to July are flatlining within a very narrow £143-£144.70/tonne range.

Looking ahead although some pig industry sources are suggesting that January will be a difficult month (it normally is), the overall outlook is much firmer than it was a year ago and at the start of 2011 in January the DAPP stood at 137.42p and wheat was worth £193/tonne. Even the euro was slightly lower at 83p and sows were worth a whopping 25p/kg less than they are today, so on a year by year comparison the Christmas stocking is half full rather than half empty.