Although the SPP is continuing on its downward track dropping by a further 1.17p to 138.46p, a much more encouraging picture is being painted the other side of the Channel with news that the latest German producer price has gone up by no less than 9 Euro Cents to stand at €1.28.
At current exchange rates, this works out at the equivalent of 111p/kg, which is still significantly below UK values, but a step or three in the right direction.
The news that pig prices are on the move has yet to filter through to weekly contribution payments, most of which are forecast to remain at similar levels within the 130p – 133p range but hopefully not for much longer.
There is still something of a backlog of UK pigs in the system, but signs are emerging that these should be cleared by the time we reach Easter.
Spot bacon pigs are in and around the 120p/kg mark with fewer below this level than last week.
Cull sow prices have always been a useful barometer of the value of pig meat across the EU and to the relief of many hard pressed producers, jumped by 10p/kg today with prices now nudging up towards the 50p/kg mark and perhaps more to come soon?
The Euro ended the week marginally dearer than seven days earlier, trading today at 87p, but a reduction in the strength of the Pound would work wonders as far as UK pig meat imports and exports are concerned.
Weaner buyers remain cautious with numbers still on the high side in relation to demand, but the rising cost of feedstuffs continues to keep weaner prices on the back foot with reports of 7kg weaners now trading at little more than £35/head in some cases.
With feedstuffs forming around 60% of pig finishing costs, high prices in this sector are doing no favours to pig breeders and finishers, with UK feed wheat traded at £213/t for March delivery and £173/t for September.
Barley values have hardened slightly trading at £170/t for March and £158/t for September.
Spot UK feed wheat traded on an ex farm basis has averaged £200/t, which is plenty enough for most pig farmers to cope with and the cost of proteins easing slightly with Hipro soya for April at £389/t and for November – April 2022 at £365/t.
And finally, despite the recent very welcome 10p/kg rise in cull sow values the soaring costs associated with exporting pig meat from the UK continues to put pig margins under pressure and these costs have gone up by around 60% since Brexit.
In addition the extra charges imposed by HMRC, their French counterparts and other veterinary charges and customs agents fees, all continue to knock a hole in the value of cull sows.
There have been calls for a more efficient digitalised export system, but until this is set up cull sow values will remain under pressure because of the extra costs involved.
Ironically, much cheaper pig meat imports seem to be able to penetrate the UK with ease, increasing the risk of bringing over ASF in their wake and therefore biosecurity needs to be greatly improved at points of entry……perhaps Donald Trump now has some disinfectant to spare!