Although the SSP has continued on its depressing downward journey and this week lost a further 0.30p to stand at 112.07p, signs are emerging of a very modest recovery in spot pig prices with one or two buyers actually out “looking”, although not at particularly spectacular prices. There were reports of spot bacon traded at around the 105p to 108p/kg mark according to spec, which is certainly better than the situation a few weeks ago.
Weekly contribution prices from most of the big players have remained unchanged, and although there is no indication of a shortage of pigs, despite the two “short” weeks, fewer pigs seem to have been rolled than usual.
However, any recovery is fragile and we still have to compete with much cheaper foreign imports coming from across the water, especially from Belgium where pigmeat demand has been badly hit by the Brussels bomb blasts.
A slightly positive note was an increase in the value of the euro against sterling, which has risen by 1.2% this week and encouraged cull sow buyers to add a fairly cautious penny to their quotes. Export sows traded in the 56p to 59p/kg range according to load size.
However, this came in the face of falls of about two cents in German slaughter pig values at a time of year when it’s hoped that European pigmeat prices will stage a recovery but, currently, there are few signs of this with slaughterings still on the high side.
Weaner prices remain under pressure with the latest AHDB 7kg ex-farm piglet average slipping from £29.36/head to £27.79/head, although 30kg pigs with earlier finishing dates staged a modest recovery moving up from £36.54/head to £36.82/head.
Signs are also emerging of a slight reduction in the number of available weaners on the market, which may help to put a base in the price at a time when virtually all weaner breeders are operating at a loss, which is clearly unsustainable in the longer term.
However, pig producers are advised to keep a wary eye on the grain futures market, which during the past week has seen March wheat increase from £100.80/t to £104.55/t, while July wheat has also hardened, rising from £103/t to £106.30/t. Any further increases in feed prices will come as particularly bad news to pig producers at a time when virtually all are operating at a loss.
And finally, good news as far as the pigmeat export trade is concerned, with the promise that UK pigmeat could soon be “trotting” across to China, with news announced by the Environment Secretary Liz Truss that discussions on the export of pigs trotters to China are at an advanced stage and hopefully trading terms will be finalised soon.
It’s only a small part of the whole pigmeat jigsaw but, as one of the leading retailers states “every little helps” – although some pig producers have changed this to “very little hurts”!