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Comment

The Final Countdown

Peter CrichtonBy Peter CrichtonOctober 18, 20193 Mins Read
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Although the SPP has risen by a further .45p to 155.77p, prices elsewhere have generally been at stand-on levels with most of the weekly contribution prices at similar levels on the week, between 148p and 157p so quite a gap between the top and bottom teams in the processors league table.

European mainland pig prices have remained largely static with the influential German producer price quoted at €185 for the seventh week running, which is equivalent to 160p in real money.

Pig meat buyers are reporting that domestic demand is below average for the time of year and despite the ASF situation in China and other Far Eastern countries putting up global pig meat values due to an ongoing lack of freezer space in the UK, we are finding it difficult to increase exports to the East and our European “partners” seem to be better at selling it than we are!

With the spot bacon market remaining generally quiet and enough pigs around to meet demand most spot bacon trading has been just under 160p/kg between 158p-160p.

The UK cull sow market is already beginning to reflect the Brexit situation with a sharp increase in the value of Sterling, which has put the euro under pressure, which traded on Friday worth 86.37p compared with 87.84p a week ago and as a result cull sow export prices have slipped by around 3p with most traded in the 108p-112p range.

Weaner prices have remained little changed, with the 7kg AHDB ex farm average price marginally easier to average £39.98/head but no quote was available for 30kg weaners for which last week’s average was £50.99/head.

However, with finished pigs making around the £125 mark per head for Red Tractor baconers and in some cases significantly more, at a time when feed prices are also in pig producers’ favour, there is significant margin to be earned for those brave enough to take the plunge and buy weaners.

Feed prices remain relatively favourable as far as finishers are concerned with the latest average UK spot ex farm wheat price £4/t easier with an average value of £126.10/t and on the UK futures markets, November wheat is quoted at £136/t and September 2020 at £147/t.

Barley continues to trade at something of a discount with November quoted at £125/t and September 2020 at £135/t.

Protein values have also slipped a tad with November-April ‘20 Hipro soya quoted at £294/t and May-October ’20 at £300/t.

Brexit D Day is almost upon us and reports that Boris Johnson has managed to achieve a deal with the EU which as it turns out, is no better and possibly worse than Theresa May had negotiated, there is still the hurdle of unruly Parliamentarians to jump and at the moment it seems to be touch and go whether or not our MPs will be prepared to vote in favour of the EU deal on Saturday.

However, it has to be borne in mind that around 50% of the UK’s import and export trade of all products is with the EU and it is easier said than done to replace these new markets overnight.

As far as pig meat is concerned the threat of tariffs being added to our post Brexit exports to the EU could knock a big hole in our pig meat export values unless our Government decides to impose tariffs at similar levels on foreign pig meat entering the UK which seems highly unlikely.

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Previous ArticleUK pork exports continued to perform strongly in August
Next Article Domestic market continues to be a struggle for processors
Peter Crichton

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