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Comment

Puppet on a String

Peter CrichtonBy Peter CrichtonMay 31, 20194 Mins Read
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Finished prices are rather like our standing in the Eurovision Song Contest and lagging well behind where they should be, although the SPP continues to nudge ahead going up another 89p to stand at 145.34p while the German producer price of €1.80 (160p) has remained at this level for two weeks running.

However, the UK has a lot of catching up to do bearing in mind the German price rose from €1.40 to €1.80 from the end of March, whereas as our SPP has only managed to increase from 137.96p to 145.34p and producers are asking why the German price has risen by 29% whereas the UK is only up by 5.3%.

Although we are told that the SPP reacts far more slowly than European reference prices, it seems to be a case of the tortoise and the hare at present and we can only hope that UK pig meat prices start to reflect the recent increases in the global value of pig meat sooner rather than later!

Abattoir weekly contribution prices have moved up marginally increasing by a copper or so in places and it will be interesting to see what sort of rises are indicated by monthly contribution prices due to be published now, all of which should feed through to the SPP to wake it up from its slumbers.

Spot bacon prices are in the 150p region and still well ahead of the SPP further underlining the need for contract prices to continue to improve at a greater rate than they are at present.

Cull sow values have remained at positive stand on levels with possibly an extra copper available in places with most between 96-102p, also helped by a slightly firmer Euro which traded on Friday worth 88.6p compared with 88.3p a week ago.

Weaner prices are continuing to improve with the latest AHDB 7kg ex farm average rising by .43p to £36.65 and although there was no published averaged value for 30kg weaners, most are trading in and around £50 for RSPCA assured but with Red Tractor pigs significantly below this level.

In the feed market, proteins have risen significantly in value partly due to poor planting conditions in the US with Hipro soya June-October 19 up from £289/t a week ago to £317/t and longer months are more expensive too, with November- April 20 traded at £325/t. Rape meal values have also hardened in sympathy with June-July 19 trading at £192/t and August-October 19 at £194/t.

UK cereals are following proteins upward trend but not to the same extent with June feed wheat quoted at £159/t and September £155/t and barley still at a significant discount with June traded at £133/t and September at £141/t.

Now might be the time for those producers who like to think ahead to possibly have a dabble in the feed markets to lock in their positions although until we know which way Brexit is going to go forward planning of any type will to some extent be a shot in the dark.

And finally China still remains on the front page as far as the global pig industry is concerned and every report seems to be more alarming than the last with some commentators suggesting that it could take five years for the Chinese pork industry to recover from ASF.

Some of China’s largest pig companies are reported to have lost up to and over 50% of their sow herds with the prospect of a huge “black hole” opening up in August when the progeny from the slaughtered sows are no longer in the system and breeding herds have yet to be replaced. Reports that China’s shortfall in 2019 could be around 16m tonnes of pig meat which is by all accounts is a lot of pork, and apparently the Chinese could eat the whole of the UK pig herd in just six days.

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Peter Crichton

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