Falling prices put pressure back on pig producers

Despite pigmeat prices generally improving during 2011 as feed costs declined, unfortunately producers’ returns ended 2011 under pressure once again.

The Deadweight Adjusted Pig Price for week ended 30 December remained almost unchanged at 147.63p/kg, but spot and contract prices were in retreat and all of the major contract abattoirs dropped their shout prices as follows:

• Gills: 145p/kg (-3p)

• Woodheads: 145p/kg (-3p)

• Tulip: 143p/kg (-3p)

• Vion: 142p/kg (-2p)

• Cranswick: 141p/kg (-3p)

As a result, spot bacon prices also fell by a similar amount, with most pigs traded between 140-147p/kg according to specification.

Cull sow prices continued to reflect generally firm EU mainland pigmeat values with UK export abattoir prices within a 112-115p/kg range, but well ahead of their levels at the start of 2011.

A relatively weak euro ended last week worth 83.50p, but any further reduction in its value would be bad news for the UK pig industry as a whole.

Weaner prices continued to improve, with the latest Agricultural and Horticultural Development Board 30kg ex-farm weaner average holding at £44.12, but spot trades reported at £2-4 ahead of this.

Ex-farm feed wheat values have been in retreat for much of the year, falling from almost £200/t in January to £140/t, but recent price rises on the LIFFE futures market are flagging up the possibilities of a reversal in this trend early in 2012.

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