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Comment

A Change is Gonna Come

Peter CrichtonBy Peter CrichtonAugust 12, 20223 Mins Read
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The SPP only moved up by a modest 0.61p this week to stand at a 196.46p but in Europe a brighter picture is starting to emerge as far as EU values are concerned.

EU pig meat prices have taken a leap of eight euro cents and the influential German producer price now stands at €1.93, which is equivalent to 163p/kg.

If this trend continues this could perhaps be a sign of a better outlook for finishers in the autumn, although on this side of the Channel there are still plenty of challenges to be faced including the weather which is scorchio!

Unfortunately, UK weekly contribution prices still remain at totally uneconomic levels as far as producers are concerned with the three major players prices quoted from 173p/kg to 190p/kg.

Spot bacon prices remain selective but should soon rise with deals agreed in and around 185p/kg with lighter weights pushing up to around 200p/kg for regular sellers.

Cull Sows
UK cull sow values have also taken a welcome upward step rising by 7p/kg after many weeks of rock bottom prices, and it was good to see them following the trend set by the German pig price with the result that most cull sow quotes for next week were between 54p – 58p/kg.

The euro has ended the week slightly firmer at 84.5p.

Weaners
Weaner prices tied to the SPP are continuing to rise with 7kg RSPCA Assured piglets per head values covering a very wide range.

However, spot loads of 30kg weaner remain hard to place with buyers also focusing on the very high cost of production which has to be allowed for to take pigs to slaughter weight.

As a result some weaner buyers and sellers are reviewing contract prices to try and level out the wide gap between finished pig prices and production costs, which according to AHDB are in the region of 231p/kg.

Feed Market Trends
Despite the opening up of the Ukraine grain export corridor currently only twelve vessels are reported to have used the route and this has yet to have any significant impact for pig producers, with feed wheat prices on the futures market up £5/t on the week and September delivery quoted at £270/t and September 2023 at £245/t.

On the spot market the UK feed wheat weekly average price was quoted on an ex farm basis at £243/t. Feed barley for September traded at £255/t and for September 2023 at £230/t.

Protein values have also shown little major change over the past seven days with Hipro soya traded at £490/t for September delivery and longer months saw May-October 2023 at £433/t.

And finally, with Autumn approaching and reports that energy costs are going to move even higher than they have done so far, UK processors will be faced with a further rise in slaughtering costs due to their high dependency on electricity and gas resulting in yet another burden which will have to borne by the pig meat supply chain, putting further pressures on margins at a time when they can least be afforded.

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Peter Crichton

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