Mixed messages in the market place with signs that finished pig numbers in the weeks ahead could tighten up following on from last summer’s infertility problems and lower weaning numbers being reported, but, unfortunately, the SPP and weekly contribution prices are also still operating in negative territory.
The latest SPP has dropped a further 1.18p to 140.51p, whereas the influential German producer price has remained at 119 EUR since mid November, but with the falling value of the Euro, this works out at an equivalent price in our money of a mere 104p/kg.
Weekly contribution prices have ranged between stand on and 2p off, between 130p – 133p.
The availability of cheap EU pig meat at lower prices continues to undercut domestic values by a significant margin, especially bearing in mind reports of imported pig meat coming to the UK which seems to have far fewer problems in clearing customs than UK pig meat travelling in the opposite direction!
UK pig prices have not been helped by the recent strength of the Pound, with a weaker Euro currently slipping in value to 87.4p compared with 90p at the start of the year.
Unfortunately, the Coronavirus continues to play havoc with staffing at some but not all of the major processors, which is yet another negative as far as the pig industry is concerned.
Cull sow prices are also continuing to suffer from the Covid effect in the EU and closer to home by putting a lid on any real expansion of the numbers of cull sows that can currently be coped with efficiently, not helped by the complexity of the archaic paperwork involved at every step of the journey from UK farms to EU meat consumers.
As a result, UK cull sow values have remained at very low levels mainly between 32p – 35p/kg.
With freshly weaned pig numbers lower than they have been, hopefully weaner prices will remain on a reasonably even keel, with the latest AHDB 7kg average currently quoted at £38.71/head. But producers, as well as finishers, need every penny they can get to meet soaring feed and straw prices, as well as those weaner producers with flooded outdoor systems needing swimming lessons in some parts of the country too!
The value of pig feed ingredients has levelled to some extent but are still far too high when compared with the cost of feed with futures prices for feed wheat quoted at £210/t for March and £166/t for September.
UK spot feed wheat has traded this week at around £196/t ex farm. Barley is still better value than wheat, with March quoted at £172/t and September at £153/t.
Proteins remain dear with Hi Pro soya traded at £426/t for March and £393/t for June-October.
And finally, as reported in last week’s commentary, ASF continues to cast its deadly shadow over the global pig industry with Germany reported to have over 600 cases in their wild boar herds, which has necessitated the expansion of the core zones where the disease has been diagnosed.
A number of these outbreaks have been close to the Polish/Saxony border and UK producers employing staff from these regions should think long and hard about their biosecurity status to avoid any accidental spread of ASF travelling in this direction.
And finally finally, despite all the current doom and gloom, UK pig producers, their staff, processors and livestock hauliers should all be congratulated for keeping the wheels turning during a very difficult period and hopefully the green shoots of recovery will start to appear soon.
