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Peter Crichton

Peter Crichton’s commentary for July 3, 2015

Peter CrichtonBy Peter CrichtonJuly 3, 20153 Mins Read
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It’s a pity the pig trade isn’t as hot as the weather, but at least prices have generally held at stand-on levels, which is better than the positon a week ago.

The SPP actually managed to put on a little ground rising by 0.4p to 132.78p, but many producers are still operating in the red rather than the black.

Spot bacon was generally traded in the 131p to 133p/kg range, although some fresh meat buyers were commenting that trade was “quiet” for parts of the pig, although the barbeque cuts are enjoying better overall demand.

Fortunately, the Greek currency upheaval failed to drive the euro any lower trading on Friday worth 71.11p, which is almost exactly where it was a week ago.

Cull sow quotes have also remained at similar levels, but are still something of a car crash as far as producers’ margins are concerned, with most export abattoirs quoting in the 50p to 53p/kg range with the market not helped by all the upheaval caused by those beret wearing onion eating surrender merchants causing havoc at Calais as far as pigmeat exports are concerned although, for some reason, the imports just keep on arriving!

Weaner markets are continuing to reflect a combination of uncertainty over realistic finished pig returns in the months ahead and a slightly more bullish grain market, with the result that the latest AHDB 30kg ex-farm weaner average has hit a new recent low of £43.47/head, with the 7kg average also slipping by 50p/head to £32.57/head.

Weaner prices often come under pressure when harvest starts as those remaining weaner buyers (still operating) preoccupy themselves with harvest and straw carting.

As reported, the feed markets are starting to show more of a bullish trend, partly due to the dry weather concisions in many European cereal growing areas. Reports of a lower than estimated Canadian spring wheat crop has done nothing to help as far as pig producers are concerned and there could also be quality issues for some US wheat crops too. The latest USDA maize and soya bean stock reports are also lower than expected.

A cooler and wetter outlook for US maize growing areas may also push the market up, although if the euro falls any further this might help to reverse the upward trends seen on the cereal markets; where July feed wheat is quoted on the LIFFE market at £120.75/t and November a significantly more bullish £134/t for new-crop wheat.

And finally, it’s good to see that pork shoulder joint demand has improved following the recent Pulled Pork Campaign, but pork chops, steaks, sausages, bacon and ham sales are, unfortunately, heading south.

Perhaps this recent spell of hot weather might continue to stimulate barbeque demand, but with chicken now 10% cheaper than pork on average, our feathered friends provide an attractive and competitive alternative, as well as being “white meat”.

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Peter Crichton

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