Another tough year forecast for pig market

Pig prices will remain under pressure this year unless demand picks up.

AHDB/Bpex forecast finished pig slaughterings and pigmeat production to rise 2-3% in the next year, keeping supplies high.

Strong production across Europe and Russia’s ban on EU imports combined to cause prices to plunge in the last 12 months.

The UK standard pigs price has fallen from 161p/kg in late May 2014 to 136.6p/kg two weeks ago.

AHDB/Bpex market specialist manager Stephen Howarth said the first half of 2015 could see more of the same, with increased supplies not matched by demand.

“From a production point of view we are expecting a similar picture next year,” he said. “Particularly the first six months of the year will be difficult. Beyond that will depend on what happens with the Russian situation and to what extent the EU supplies start to tighten.”

Falling UK prices had not caused producers to cut production – feed values had been low and most farmers had been at break-even at least until recently, said Mr Howarth.

Sow slaughterings were still back on last year which suggested producers were not yet reducing herds or leaving the industry, he said.

Mr Howarth said boosting exports would be difficult with a strong pound against the euro. Lower EU prices were exerting a downward pull on the market but had not so far been drawing in extra imports to the UK.