Unless the euro starts to regain some strength against the pound, pig prices will struggle to recover to the levels seen in recent years, according to AHDB Pork.
Responding to the fact that the pound recently hit its strongest level against the euro for nearly eight years, AHDB Pork has assessed the implications of the present currency exchange imbalance as it affects UK pig prices.
“Over the last decade, there has been a fairly close relationship between the exchange rate and the GB pig price,” said AHDB Pork, adding that there is little doubt that the weakness of the euro has contributed to the fall in pig prices over the last year.
“If this doesn’t change, pig prices will struggle to recover to the levels seen in recent years. The euro was regularly below 70p between 2004 and 2007 and, during this period, the pig price was consistently below 140p/kg, even when converted to today’s prices.”
Cull sow prices are even more directly affected by the exchange rate, given that most sow carcases are exported to the Eurozone.
“Again,” added AHDB Pork, “this means there is little prospect of a recovery in prices, which have recently been at their lowest level since 2007, the last time the exchange rate was at similar levels to today.”
