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Comment

China Crisis

Peter CrichtonBy Peter CrichtonApril 18, 20193 Mins Read
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As those of us of a certain age know, one has to pause for breath occasionally on the rush upstairs to the bedroom and this is what prices have done in Europe, where after five consecutive weeks of rising to the tune of 33 euro cents (28.5p), prices have taken a breather.

However, here in the UK the influence of much higher EU mainland pig meat values is finally starting to seep through to the SPP and weekly contribution prices, with the former rising by .64p to 138.31p and most weekly contribution prices up by around 2p, which means that the majority are now between 130p-133p, but there is still a long way to go before they reflect what has happened in Europe and beyond, with the Chinese ASF situation continuing to put upward pressure on the global pig meat market.

Very few pigs were traded on the spot market, with most of the big players taking all the numbers available on contract and no reports of pigs being rolled, as well as forecasts of a shortage of UK pigs in the system in the months ahead, but spot quotes today were generally at no less than 142p with more in places.

In line with German pig meat values, cull sow prices have stood on, with most now between 87-93p according to numbers and hopefully there may be room for further price rises in the weeks ahead. The euro has held at generally similar values on the week, trading on Thursday worth 86.47p, but further reductions in the value of the £ would also help to put up the cost of pig meat imports and exports to and from the UK.

Weaner prices have yet to fully reflect the upward movement in pig meat values, with the latest AHDB 7kg ex-farm average quoted at £35.73, but no average price was published for 30kg weaners which last week were worth £47.45 but with an upcoming shortage of weaners in the system, UK piglet values should start to improve especially if feed prices remain under control.

UK protein prices are remaining at similar levels, with 48% soya traded ex-Liverpool at £291/t and 34% rape meal ex- Kent at £191/t. Futures prices have also held at generally similar prices on the week with London feed wheat quoted for May delivery at £163.85/t and November at £147.05/t.

And finally, China continues to dominate pig market news with reports that they are estimated to import 10 million tons of pork this year, which will make prices move sharply higher in the global market.

Pork prices in China could increase by 70% until the end of the year where a 10% decrease in the national pig herd has already been identified for the first quarter of this year, with more to come according to official sources.

However one possible fly in the ointment is that there are reports of significant increases in poultry production systems and facilities throughout the Far East, which can quickly replace shortages of pig meat over a relatively short period, something of a “chicken and egg” situation.

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Previous Article‘Not enough pork in the whole world’ to fill China’s supply gap
Next Article Why Brexit stockpiling is preventing China effect on UK pig prices
Peter Crichton

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