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Peter Crichton

Peter Crichton’s commentary for November 8, 2013

PW ReportersBy PW ReportersNovember 8, 20133 Mins Read
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Although there were signs that one of the larger processors wanted to drop contract prices to meet the upcoming threat of cheaper foreign pigmeat imports, as it turned out most (but not all) prices stayed at stand-on levels, with the Tulip weekly price quoted at 168p and Gills at 172p.

The DAPP eased back a shade to 172.03p, but this is still a great improvement on its value of 159.46p a year ago when wheat was trading at £205/t.

There’s no doubt that the horsemeat scandal and the availability of isotope testing has concentrated retailers and processors minds on sourcing larger volumes of UK pigmeat and to quit “horsing around” with cheaper foreign imports. 

Spot buyers were also busy in the market and prepared to pay prices in the 174-177p/kg range according to spec, which makes some contract prices look modest by comparison, although the spot market is not a place for the fainthearted at certain times!

Although the Euro took a fair drop this week, trading on Friday at 83.47p compared with 84.62p week ago, there were no further falls in cull sow prices, which stood-on. Quotes were generally in the 110-114p/kg range according to spec.

Weaner prices are continuing to improve across the board as finishers have finally tumbled to the fact that they’re making good margins with feed and weaner prices at current levels with the result that the AHDB 30kg ex-farm weaner average has jumped from £54.26/head last week to £55.93/head this week.

Freedom Food 7kg piglets are also attracting more attention and are trading in the £40-42/head range and a glance at the calendar reveals that these should be ready to sell as slaughter pigs early next spring when prices normally start to rise, although we shall see.

As mentioned, feed prices have remained at relatively static levels with ex-farm feed wheat quoted at £156/t and LIFFE January 2014 wheat at £164/t rising to £169.50/t in July 2014, down by 1% on the week. Proteins have also dropped with soya down by 4%.

And finally, providing supply and demand remain in balance up to Christmas, and buyers can be persuaded to continue to source UK rather than imported pigmeat, we should see reasonable margins over the Christmas and New Year period. Although, as past experience has taught us, the first couple of months in any New Year can be challenging, which is why finishers are advised to keep on top of their weights over the Christmas period.

> Suffolk-based Peter Crichton is an auctioneer 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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