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Comment

Keep Your Head Up

Peter CrichtonBy Peter CrichtonMay 21, 20224 Mins Read
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Mixed messages from the market place with the SPP up a gnat’s whisker by 1.15p to stand at 172.76p, but still miles behind production costs.

EU pig meat prices are in the main treading water and the influential German producer price is quoted at 1.80 EUR, which translates to just over 152p/kg in our money. As a result, a surge of cheaper low welfare pig meat keeps heading in this direction and undercutting domestic prices by a country mile or more.

Spot bacon buyers have had a quieter week with prices in and around 150p/kg, but over 20p/kg behind contract prices.

UK weekly contribution prices have however had a bit of a shake up with one of the major players increasing their quote by 10p/kg to 180p, whereas the others have mainly stood on between 168p – 190p. But at the same time, it has to be borne in mind that with plenty of pigs in the system and generally poor demand, significant numbers of pigs have also had to be rolled next week.

Cull sow prices continue to reflect a static situation in the EU with most in and around 63p – 67p/kg, but plenty of numbers seem to be coming forward with more herds being culled due to the chronic financial situation facing the pig industry.

The Euro has dropped from 85.11p last week to 84.8p today and has done nothing to help the import/export balance as far as pig meat is concerned.

Weaner prices are continuing to improve as far as contract deals tied to the SPP are concerned and although no AHDB figures have been published, 7kg RSPCA Assured weaners are generally trading above £40 per head, but spot weaners are still in a chilly climate with very few takers and buyers keeping a wary eye on feed prices and the prospects for finished pigs in the months ahead, which at this moment in time are extremely difficult to predict.

Feed ingredient prices remain at eye-wateringly high levels, although there has been some slight technical easing of prices in some sectors following the news that the Russian grain harvest is likely to be ahead of expectations with perhaps fewer buyers prepared to deal with this rogue nation; we shall see.

Feed wheat values have eased with June delivery quoted at £331/t down by £11/t on the week and UK spot feed wheat on an ex farm basis traded at an average of £326/t. Barley prices have also nudged slightly lower but not enough to make any real difference with June quoted at £313/t and longer months saw September at £327/t.

Proteins have unfortunately risen in value with Hipro soya for June – October at £472/t and for May – October 2023 at £449/t.

And finally, thanks to the hard work of the NPA in particular, it is good to note that some but not all of the major retailers and processors are finally taking note of the financial plight of the pig industry where production costs continue to soar far above pig meat values.

It would however be a mistake to feel that these measures will put the industry back on its feet because in many cases their offers come either too late or too little or a combination of the two.

But looking further ahead for those who can hold on long enough, there will soon be a pig shortage and it is a case of when not if, but a sea change of the whole pig meat supply chain is needed to get UK pigs back on their feet again. But many factors seem to be working against them which include feed prices, fuel costs and soaring wages with the latest costings indicating that Red Tractor producers will need to receive prices in excess of £2.20/kg to stay in business – until then, ‘chin up’.

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Previous ArticleCo-op urges other retailers to back British pig farmers after announcing £19m investment
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Peter Crichton

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