19 July 2002

Imports push pig price below £1/kg safety net

By James Garner

PIG producers are heading towards yet another market slump as the trade feels the pressure of foreign imports and slips below the £1/kg mark.

This weeks GB adjusted Euro spec average (AESA) has fallen again by another 1.58p on the week, levelling at 97.78p/kg. This is the second week in a row that pig prices have fallen below the £1/kg level, break-even for many pig producers.

The downward trend marks the end of two months of improved pig prices. Ian Campbell, of the National Pig Association, says the big differences between UK prices and those of the Danes and the Dutch a few weeks ago must have encouraged pig buyers to shop abroad.

"Many pig producers need 100-105p/kg to stay in business, but when it is only 70p/kg in other EU countries the difference is hard to sustain."

Some quarters are blaming the poor summer for the downturn in trade, leaving processors unable to shift extra supplies imported from abroad for the barbecue trade.

Independent pig consultant Peter Crichton agrees the drop is due to imports. "The UK pig market is lacklustre and thats because of foreign competition. If we could sell the whole of a pig as well as they do on the Continent then our trade would be a lot better."

He adds that cheap legs and other cuts from abroad are downgrading the overall value of UK carcasses, but with the weekly kill slipping to between 180,000 and 190,000, compared with over 300,000 a few years ago, the UK remains susceptible to imports.

Dutch exports are equivalent to nearly half that shortfall, says Mr Crichton. He adds that any halt on production at farms suspected of being contaminated with the hormone MPA, or Medroxyprogesterone-acetate, could give the UK trade a brief lift.

However, it is expected their voluntary ban will be lifted by the end of this week, so the impact could be short-lived. &#42

Finished pig prices have once again slipped below the critical £1/kg mark.