Peter Crichton’s commentary for May 2, 2014

As expected, with yet another short week ahead, prices have remained at similar levels although spot quotes were, in some cases, tending a shade easier, reflecting the recent marginal reduction in the DAPP which dropped by 0.29p and now stands at 163.42p compared with the latest APP issued for the previous week at 164.89p.

Spot bacon prices were generally within a fairly tight 165-168p/kg range, and a return to better weather would work wonders as far as barbecue demand is concerned.

Sow prices have also held at similar levels, reflecting relatively static European mainland pigmeat values with most export abattoirs offering in the 97-100p/kg range according to load size and specification.

Reports of a recovery in the UK economy might put pressure on the value of the euro, which traded on Friday worth 82.22p – a stronger pound is normally bad news for the pig industry as a whole.

Weaner values have also steadied, with the latest AHDB 30kg ex-farm average slipping from £57.75 to £55.33, but 7kg pig prices have recovered from last week’s drop with the latest 7kg average quoted at £41.08.

The grain markets have ended a relatively quiet week, with ex-farm feed wheat trading at £164/t and LIFFE feed wheat futures prices showing a slightly easier trend when compared with a week ago. May traded at £167/t and July at £167.75/t, but November eased back to £157/t.

A solution to the unrest in the Ukraine would possibly help to settle the market and nudge cereal prices downwards, but this may well be countered by reports of ongoing dry weather conditions in the US, which could, unless the situation changes, lead to yield reductions and poorer availability.

Barley prices are, however, showing a significant discount of about £20/t, which some producers have woken up to, especially as the UK crop is reported to be the largest for 15 years.

The upcoming Pig Fair, which takes place in just under two weeks on May 13/14, always provides a useful benchmark. For comparison purposes, in early May 2012, when the Pig Fair last took place, the DAPP stood at 146.92p, ex-farm feed wheat was trading at £170/t and a weaner could be purchased for £46. So the industry is generally in better health than it was two years ago, but let’s hope this continues into the future!

> 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

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