Peter Crichton’s commentary for July 12, 2103

The recent heatwave has helped to maintain pigmeat prices across the board, with the DAPP rising by 0.35p to stand at another new high of 168.53p, but sadly, following Tulip’s lead, all of the shout-price abattoirs decided to stand on and remain as below:

Woodheads   169p
Gills   166p
Tulip   166p
Karro   163p
Cranswick   162p

Spot buyers were looking for pigs (but not at any price) and were quoting in the 170-174p/kg range according to region and specification, which makes the gap between shout and spot prices hard to explain to loyal contract sellers.

Even at these higher price levels, pork still provides excellent value for money, especially when compared with beef and lamb.

Foreign imports do, however, remain a threat, although further rises in cull sow values are indicating generally firmer EU mainland pigmeat value across the board.

Cull sow prices rose by a further 3p/kg with most abattoirs bidding in the 115-117p/kg range according to load size and specification.

A firm Euro has also helped to maintain cull sow values on an upward track trading on Friday worth 86.36p, but pigmeat import still remain a potential threat to the future profitability of the UK pig industry.

Weaner prices have continued to improve with the latest AHDB 30kg ex-farm weaner average now quoted at £53.88/head and 7kg weaners generally trading in the £36.50-39.00/head range.

Recent falls in cereal prices appear to have levelled out following USDA reports of lower 2013-2014 global wheat stock estimates following higher Chinese feed demand to supplement their poor domestic crops.

If the American drought in some of the western states spreads into the corn growing belt, this may also put some upward pressure on prices, although harvest reports from the Ukraine are indicating much better yields than previously forecast.

Once again, it’s global events that will be the main factor affecting the value of the UK pigmeat production.

All in all, this might still be a time for prudent producers to look at securing some cover and off-the-combine wheat is likely to be traded at about £170/t when harvest gets underway.

Looking ahead, there’s likely to be a decrease in EU pigmeat production for the second year running and 2012 output fell by 2% with the European Union December Pig Census also down by 1.8%. More limited supplies should, to some extent, help to reduce downward pressure on the UK pigmeat market for the remainder of this year.

> Suffolk-based Peter Crichton is an auctioneer Peter Crichton provides a wide range of valuation, auction and livestock marketing services, as well as supplying the UK pig industry with a wide range of consultancy services covering tenancy, contract advice, pig equipment and herd valuations as well as dispute resolution. For more information visit: www.petercrichton.co.uk

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