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Further uncertainties to follow the “roller coaster” year that was 2016

PW ReportersBy PW ReportersJanuary 11, 20172 Mins Read
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Last year has been termed a “roller coaster” 12 months by AHDB Pork, a verdict delivered at a time when questions are now being asked concerning the prospect of 2017 containing even more uncertainty for the sector.

“2016 was a year of highs and lows for the UK pork sector,” said AHDB Pork, adding that after prices in March fell to their lowest level since 2008, the industry had 37 continuous weeks of price rises, adding up to the longest period of increases on record.

“Higher supplies at the beginning of the year drove price falls up until late March. Supplies then began to tighten, European prices began to rise and Chinese demand was high, which led UK prices to begin to increase.

“In late June the increase was accelerated by the fall in the value of the pound which followed the result of the result of the EU referendum. The fall in the value of the pound made imports to the UK more expensive, while making UK exports more competitive.

“Despite this, tighter domestic supplies led to a rise in UK pork imports. This was despite the EU average pig price moving above the UK price in sterling terms between September and October.”

In looking ahead, however, AHDB Pork admitted that there were plenty of uncertainties still surrounding the pig sector.

“Moving forward supplies are expected to remain tight in the UK in the first half of 2017,” it said. “Other than that, there remains a great deal of uncertainty, particularly surrounding the UK’s relationship with the EU.

“The weak pound, driven by this uncertainty, should continue to make UK exports more competitive as well as making imported product less competitive on the UK market. However this will also drive up the cost of inputs such as feed and fuel, making this a time when producers will need to ensure they have close control over their costs.”

See full 2017 analysis

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