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Comment

Happy birthday

Peter CrichtonBy Peter CrichtonJanuary 4, 20193 Mins Read
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Not a particularly exciting start to the year with the SPP still heading south losing another 1.08p to stand at 140.6p (its lowest and its highest position this year!) and which is almost exactly 10p (£8 per pig) down on its value 12 months ago.

Fortunately, the influential German producer price has held at similar levels for the last 11 weeks at €1.36, which is equivalent to 122.4p in our money but serves to underline why imported pig meat is so darned cheap compared with our high welfare UK pigs.

Most of the large weekly contribution price players saw the drop in the SPP as a signal for their weekly contribution prices to also lose a penny or so and most are now quoted within the 127.5p-133p range which is well below producers COP levels.

The spot bacon market has remained extremely quiet and although some spot deals were done they tended to be in the 132p-135p range but with more for regular sellers.

Cull sow prices have also held at similar levels with export abattoirs offering low prices in the 58p-60p range compared with 67p at the start of last year.

The Euro ended the week little changed trading at around 90p but if any definite news hits the press concerning a Brexit no deal this could hit the £ and push up the Euro which will in the short term help to put up imported pig meat prices as well as the value of our pig meat exports to the EU.

Weaner prices have recently endured something of a roller coaster relationship and like most roller coasters they end up back at the bottom of the ramp and prices remain under pressure with the latest AHDB 30kg ex farm average dropping by just over £3 to stand at £44.40 and 7kg prices also took a knock falling by 82p to stand at £35.62p.

Those weaner producers with “bottoms” in their contracts (and their trousers) are fortunate that hopefully they will still be able to maintain prices ahead of COP levels but as far as Red Tractor weaners are concerned the market is still much more challenging than it is for RSPCA Assured and in some cases could also be described as “bottomless”.

Rising feed prices continue to cause significant anxiety and in some cases, financial losses with UK wheat futures prices still painting a fairly expensive picture with March quoted at £176.30/t and July at £181.30/t.

Protein prices have however ended the year on a slightly easier note with late December trades of 48% soya meal ex Liverpool at £317/t and 34% rape meal ex Kent at £210/t.

And finally, those of you with long memories may recall the Traffic Light pig price advice service which was launched by a number of concerned producers’ way back in January 2002 and has now celebrated its 17th birthday.

During the course of its lifetime the lowest level that the TL fell to was 85p in September 2002 and its highest point was 178p in November 2013. With current COP levels in the region of 140p and the SPP now at 140.6p, many producers will find it hard to break even and some are already in the red, but if there is a price revival hopefully the first signs could be seen in the spot market so producers should keep a close eye on the TL website which is www.tlspot.co.uk.

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Peter Crichton

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