16 May 1997

Which way will pig prices go?

PIG industry opinion is split as to where prices are heading.

Taking a bullish line is the Meat and Livestock Commission, which suggests that any fall is unlikely in the coming months. It cites the classical swine fever epidemic on the Continent as the main factor.

Latest estimates suggest, if the full slaughter provisions are enacted, the Netherlands could lose over a quarter of its annual output. And EU supplies could fall by over 3% this year.

This has contributed to rising prices recently, with spot markets over the 110p/kg mark last week. And thats something that hasnt been seen since the early autumn of 1996.

Other sectors of the industry, however, think a weakening of trade inevitable.

Andrew Chitty of the Guildford-based Chitty Group reckons consumer resistance has increased and prices have now peaked. "Supermarkets will say that there is not sufficient margin in pork – and will sell more beef and lamb."

Other trade sources point to the increased resistance coming from the manufacturing sector.

One buyer for a major abattoir said anyone paying over 150p/kg dw – as some were doing last week – would be losing money. "At about 135p/kg dw, prices are more sustainable," he says.

And the first reaction against the high values may have appeared in the spot market early this week. "Buyers were not screaming for pork as loudly as they have been."