By Peter Crichton
DESPITE falling pig numbers in the UK, traders are pointing to the current pattern of prices throughout the EU as the main reason for the recent recovery in producer returns on the home market.
The latest UK AESA – announced at 91.43p/kg – is the highest point the index has touched since June 1998 and puts most breeder finishers back into the black excluding borrowing charges.
At the same time, pigmeat prices in most of the major EU production countries has also risen.
Although Dutch and Danish imports continue to hit the UK market they too are dearer despite of the weakness of the Euro.
The AEX Dutch futures market still provides one of the best indicators of the strength of the overall European pigmeat supply situation which has such a strong bearing on UK prices.
Dutch futures quotes through to December remain firm in the 84-88p/kg deadweight range, based on a much heavier carcass weight than in the UK.
Danish and German prices are also in the 70-75p spread on the physical market, although French and Spanish quotes are 5-10p/kg below this.
All of these reference prices should provide some comfort for UK producers trying to look ahead after two years of negative returns.
Another European issue is the threat that under EU rules some foreign pig products may qualify for use of the “kitemark” being developed by the NFU to promote British foods including pigmeat.
The potential use of a British mark on any imported pigmeat is reported to infuriate members of the NFU and militant action can also be expected from the British Pig Industry Support Group unless this proposed abuse of the UK mark is stopped.
Under current EU regulations there is nothing to stop imported pigmeat being labelled as produced to British farm standards if it complies with UK quality levels.
According to the NFU imported products that carry the kitemark will also be labelled with country of origin.
- Peter Crichton is a Suffolk-based pig farmer offering independent valuation and consultancy services to the UK pig industry