29 August 1997

Pig values… too good to last for ever

By Tim Relf

UK PIG producers are seeing prices tumble, despite the effects of disease on the Dutch industry.

Spot values on Monday fell to less than 67p/kg lw. Only as recently as June, levels were over 100p/kg.

Jane Connor of the Meat and Livestock Commission says the market became "over-excited" after the classical swine fever outbreak in Holland. "Price hikes earlier in the year were largely speculative.

"While the disease is leaving a big gap in supplies, the current exchange rate is working against UK producers, preventing us from capitalising on it."

EU-wide reduction in supplies

While Hollands problems will lead to an EU-wide reduction in supplies, expansion continues in the UK herd. MAFFs April census figures suggest UK pig slaughterings will rise 4.5% in the year to Mar 1998.

Such expansion has been seen by auctioneers. Chris Clubley at Selby says a rise in supplies, together with the strength of sterling and the hot weather, have driven the trade down.

With little price difference between the light and the heavy animals, farmers are growing them to bigger weights, he says.

NFU pig committee chairman Graham England says the pig sector is no more insulated from the strength of sterling than any other commodity.

Imports are being sucked in, upsetting the fine balance between supply and demand, he says.

Farmers facing the prospectof low grain prices should notbe tempted to retain it as feedand begin pig production, he warns.

"Anyone who tries to make a quick killing will further imbalance supply and demand – and cer-tainly wont get rich in theprocess."


Pig Slaughterings

(`000 head)

Actual and forecast, EU-wide for year ended Mar 31

1996189,787

1997190,482

1998186,326

1997/98

change- 2.2%