Peter Crichton’s commentary for December 13, 2013

Christmas is a time for giving as well as taking, and on this occasion spot sellers had to take a significantly lower price for their pigs than recently.

Although the DAPP has continued to improve – and now stands at 171.69p – and despite Tulip standing on at 168p and Gills at 172p, unfortunately reduced slaughtering space in the week ahead has meant that a significant number of pigs were offered on the spot market which brought the price down by up to 5p/kg with the result that for those sellers who had to move pigs rather than rolling them into the following week, 170p/kg was the price.

At the start of the year sellers would have happily settled for this, but it’s a pity to see spot prices ease back from almost 180p/kg a few weeks ago, but not surprising in view of much lower EU mainland pigmeat values.

Cull sow prices also continue to reflect a less-than-buoyant EU mainland pigmeat market, with prices paid by UK cull sow buyers dropping by a further 5p/kg. Most quotes were in the 105-108p/kg range, but not much enthusiasm for big numbers due to full cold stores in mainland Europe and no likelihood of any significant improvement in demand until the seasonal holiday period is well behind us.

This fall in cull sow prices was in spite of a slightly firmer euro which closed on Friday worth 84.5p compared with 83.6p a week ago

Weaner prices have also hit something of a plateau, although with more space in the system and some empty units to fill buyers are still on the hunt for replacements. The latest AHDB 30kg ex-farm weaner average has eased back to £55.82/head, but Freedom Food 7kg weaners remain in demand and worth £40/head or more.

The grain markets have ended another fairly calm week, although early 2014 futures prices have moved up by a few points with January feed wheat trading at £165.50/t on the LIFFE market and July at £168/t.

Soya prices have eased with Hipro soya ex-store trading on the East Coast for February delivery at £360/t, but rape meal went up by £5/t to £211/t for January delivery.

And finally, opportunities might exist for forward-sighted producers to try and insure against the rollercoaster nature of the pig cycle. Some are not only locking into forward feed prices, but also talking to abattoirs about the possibility of long-term fixed-price slaughter pig deals as well.

Food for thought over the Christmas break, perhaps?

> Suffolk-based Peter Crichton provides a wide range of valuation, auction and livestock marketing services, as well as supplying the UK pig industry with a wide range of consultancy services covering tenancy, contract advice, pig equipment and herd valuations as well as dispute resolution. For more information visit: www.petercrichton.co.uk

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