Peter Crichton’s commentary for September 25, 2015

Another rather muted trading week has drawn to a close, with prices continuing to drift back in line with the falling SPP, which lost 0.74p this week and now stands at 130.38p.

For those of you with short memories, the SPP this time last year stood at 156.07p, so a 75kg deadweight pig has dropped in value by £19.50/head compared to 12 months ago.

Most weekly announced prices have remained at stand-on levels and the spot market has also been under pressure, although volumes have been light. Where buyers were prepared to take extra pigs, bids were generally in the 126p to 128p/kg range, although regular sellers of spot bacon were generally trading at 2p to 4p/kg more than this.

The ongoing Putin ban on EU food imports is continuing to hit the industry hard, and there are no real signs of a thaw in relations behind the Putin curtain at a time when reports are being received of the Russians’ intention to step up domestic pig production too.

Cull sow values have remained at similar levels with most quotes between 60p to 63p/kg according to load size and spec, with reports that there “plenty about”.

The euro has improved marginally in value, and although it touched 74p yesterday, it traded on Friday afternoon worth 73.6p, which looks as though that will probably set the seal on the Basic Payment Scheme rates due to be paid for the 2015 claim year.

Not much excitement as far as weaner prices are concerned, although the AHDB 30kg ex-farm average has improved marginally to £45.21/head, but 7kg piglets are still trading at a significant discount at a stand-on £32.38/head.

As previously mentioned, it is, however, important to remember that these prices include a large number of contract trades and one-off spot quotes are £2 to £4 less than this in some regions.

Slightly worrying news in the feed markets as well, with November feed wheat quoted on the LIFFE market at £116/t, up £2.65/t on the day, and January also showing a firmer trend at £118/t.

At least Hi-pro soya prices have continued to fall, dropping £2/t to £264/t ex East Cost ports.

Although feed prices are still at generally lower levels, early worries about the viability of 2016 Black Seed crops have put a small cat among the pigeons, with the result that November 2015 futures recorded the biggest daily upward change for the past three months.

The situation isn’t being helped by concerns about the slower rate of winter crop planting in Russia and the Ukraine due to adverse weather conditions, not to mention the problems of trying to run a farm in a warzone as far as some of the Ukrainian grain farmers are concerned. It’s a region where it would be unwise to wear a hi-viz jacket as you could be used as target practice by the other side!

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About The Author

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