It was another positive day as far as sellers are concerned, with the SPP continuing its recent recovery and putting on another 1.57p to stand at 128.14p. But, before producers start cracking open bottles of bubbly, it’s worth remembering that this time last year the SPP stood at 133.07p, and the euro was only worth 70.68p compared with its value of 83.94p on Friday afternoon.
Weekly contribution prices have, in the main, stayed at similar levels, although one went up a penny, with most now between 127p and 136p/kg.
The spot bacon market continued to reflect a shortage of pigs in the system, and although prices were at generally positive stand-on levels, as with weekly contribution prices, an odd copper or two extra was available and 140p/kg paid in some cases by abattoirs, but on a slightly tighter spec than those taking pigs up to 100kg on a 14 probe where spot quotes tended to tended to be in the 136p/kg region.
Cull sow prices have remained at similar levels reflecting the stand on nature of German pig prices, with the result that most cull sow quotes were in the 74 to 77p/kg range according to load size.
Weaner prices are also continuing to improve, albeit any contract quotes are now lagging well behind spot, with the latest AHDB 30kg ex-farm average quoted at £42.70/head and 7kg at £31.33/head, but this trend should be maintained providing the SPP continues on its upward track, but spot weaners are generally anywhere between £2 to £4 ahead of contract values, which is the reverse of the situation only a few months ago.
The UK 2016 barley harvest is now well underway with reports of indifferent crop quality and relatively low bushel weights, so it may be that some malting varieties could end up as feed.
Feed wheat futures have remained relatively steady with November 2016 quoted in the LIFFE market at £123.50/t and March 2017 at £126.90/t.
However, analysts are reporting GB wheat yields need to exceed the 2015 record tonnages to avoid a fall in overall GB wheat production because of smaller areas being planted, which is one of the casualties of the Black Grass infestation now a problem in many parts of the country.
When the wheat harvest is underway, off the combine ex-farm prices are expected to be in the £110/t to £112/t range, although much may depend on the quality (or otherwise) of the sample.
And finally, the EU Farm Lobby Copa-Cogeca has warned that EU exporters are being increasingly reliant on the Chinese market, which could pose a risk to this sector later on, but the other side of the coin is that up to now the revitalised Chinese market has worked wonders for global pigmeat prices, and even if it slips in the future, “half a loaf is better than no bread”.