Peter Crichton’s commentary for March 7, 2014

Although pig prices look as though they’re on the rise after the traditional January/February dip, the political situation in Ukraine is continuing to unsettle commodity markets, which if sustained could soon filter through to pig feed prices.

Although the DAPP took a further downward step and now stands at 163.08p, spot buyers were generally prepared to sharpen their pencils to some extent with the result that spot bacon was generally traded ahead of the 162p/kg mark with some having to consider paying 4-6p/kg above this to secure the numbers required.

This is in the face of the ongoing African swine fever related Russian pigmeat import ban, which helps to explain why cull prices are still at relatively low levels and currently showing no signs of improvement.

However, with many bacon pig contract prices now tied to a mixture of the DAPP and spot quotes, it’s hoped that more activity on the spot market will help to stimulate contract prices across the board and revive a flagging DAPP.

A small improvement in the value of the euro, which rose by 0.6% this week to trade on Friday afternoon worth 82.93p, could also help to some extent as far as the import/export balance is concerned.

Cull sow prices are still priced within a fairly narrow trading band with most quotes in the 95-98p/kg range, and some relaxation of the Russian import ban would no doubt stimulate this sector overnight, but this is probably a fair way down Mr Putin’s hit list at present.

Weaner prices are continuing to signal a shortage of numbers in the supply chain, and despite the threat of higher feed prices, the AHDB 30kg ex-farm weaner average moved up by almost £3/head this week and now stands at £57.44/head, although 7kg piglet values have remained almost unchanged at £41.47/head.

The uncertainty surrounding the Ukrainian situation led to UK wheat futures prices exceeding the £160/t level for the first time since the start of the year, and those producers who have already taken feed cover might for the time being be pleased they have done so.

Soya bean prices have also closed higher with Hipro quoted at £400/t ex East Coast ports, representing a rise of circa £10/t.

But, before we relax, producers must continue to support efforts by the NPA to focus attention on the twin dangers posed by African swine fever and PED (porcine epidemic diarrhoea), both of which could massacre our domestic pig industry if port and import controls are breached.

Many of us can still remember the 2000 swine fever outbreak that hit much of East Anglia, not to mention the widespread FMD epidemic in 2001, as well as a further escape of FMD from the Government’s Pirbright laboratory in 2007.

Dark days, but vigilance must remain the key word and imports should be subjected to the highest levels of scrutiny and tests known to man (or woman).

> Based in Suffolk, 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

Get Our E-Newsletter - Pig World's best stories in your in-box twice a week
Will be used in accordance with our Privacy Policy
Share.

About The Author