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Welcome to Hard Times

Alistair DriverBy Alistair DriverSeptember 25, 20203 Mins Read
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Hard times for pig sellers with supply exceeding demand on both sides of the Channel and, although UK prices are easing, the situation in Germany seems to be closer to stand-on, which is at least half a step in the right direction.

The latest SPP has fallen by 1.14p to 159.8p, but the German price has stood at 1.27 EUR following last week’s heavy falls at 1.27 EUR, which is equivalent to 116p in our money and a long way below UK values, hence cheap imported EU pork is cutting a swathe through the UK market.

With most UK abattoirs being offered more pigs than space permits, there is very little demand on the spot market with regular sellers achieving prices in and around 148-150p but non-farm assured one-off loads of spot pigs are lower than this.

Weekly contribution prices are down by between 1p and 2p, which means that most are now quoted between 147p and 153p compared with 166p and 158p in early July. Times they are a’changing.

Sow prices are also holding at similar levels, following last week’s 10p fall with most trading between 40-45p which means the average sow is worth little more than £60, and it would need three culls to buy one gilt although the value of the Euro has remained static at 91.35p.

Weaner values are slightly harder to establish in the absence of no average statistics being published this week by AHDB, due to insufficient samples, but with most weaner prices tied to the SPP, values will be in decline to some extent with RSPCA Assured 7kg pigs generally trading in the £40-£43 range and Red Tractor £2-£4 below this. 30kg prices are also easing with RSPCA Assured in and around £55/head and Red Tractor at a discount of £2-£4.

Feed prices are continuing to rise putting more financial pressure on producers’ margins with the latest UK feed wheat futures price quoted at £187/t for October and £156/t for September 2021 but barley appears better value at £143 for October.

Protein values have also continued to climb, with Hipro soya quoted at £353/t for October-April ’21 and £326/t for May-October ’21.

To rub more salt into the wound, straw prices are reported to be rising significantly due to indifferent yields at harvest and if a long period of wet weather hits the UK this could push prices further north at producers’ expense.

And finally, although the news headlines are very much focussed on the Covid pandemic, the Brexit timetable is gradually getting tighter with only around 90 days to go before a Deal/No Deal situation is arrived at.

In the latter case, this could play havoc with UK pig prices especially as far as the possibility of any tariffs or haulage disruptions affecting UK meat exports, which would hit the cull sow market which is already on its knees in financial terms. This is as well as the threat of cheap WTO pork hitting these shores from non-EU countries at discounted prices, especially if ASF outbreaks in Germany and closer to home continue and the Chinese maintain they will not import pig meat from any ASF infected countries.

However, the good news is that US pig prices have soared on the back of the German ASF outbreak, so every cloud has a silver lining perhaps?

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Previous ArticleAHDB questions Defra figures suggesting fall in English breeding herd
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Alistair Driver

Editor Pig World, group editor Agronomist and Arable Farmer and Farm Contractor. National Pig Association webmaster. Former political editor at Farmers Guardian. Occasional media pundit. Brought up on a Leicestershire farm. Works from a shed in his Oxfordshire garden.

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