Pig prices have dropped for the seventh consecutive week, taking levels to about 20p/kg lower than 12 months ago and well below the cost of production.
According to the latest figures from AHDB Pork for the week ending 2 January, the EU-spec SPP fell by 1.49p compared with the previous week to 121.97p/kg.
Independent pig consultant Peter Crichton said the slump in prices had been caused by high production levels, pressure on demand and competitive EU pigmeat imports, which were attractive to those retailers engaged in discounting.
The Russian ban on meat imports was also still having a big effect on prices, he added. And while there were alternative markets in China, there was also strong competition from the US to secure this business.
“On average we are probably about 15p/kg adrift on the cost of production on what we are actually receiving,” he said.
“There could be losses for some Red Tractor-assured finishers in the region of £10 a pig.”
Mr Crichton said feed prices were working in farmers’ favour and interest rates were still low. “But if either were to go up there would be a big effect. Very few [producers] are in the black now.”
According to the AHDB Pork report, estimated slaughterings for the week ended 2 January increased by 3,500 head compared with a week earlier to 112,700 head.
However, with the Christmas holiday shutdowns, estimated slaughterings for the week ended 26 December fell by 77,500 head week on week to 109,200, although this was 17,400 head more than the same week in 2014.
The average SPP carcass weight for the past two weeks also increased as producers held on to pigs for longer over the festive period.
For the week ended 2 January, the average carcass weight was 83.02kg, the heaviest weight since February 2015.