Pig margins can remain stable until Brexit, says analyst

The margins British pig producers are receiving can be maintained until the UK leaves the EU in 2020, according to consultant and market analyst, Peter Crichton.

The GB APP (UK spec) price for the week ending 29 April was 156.18p/kg, 38% up on the year before.

Producers with finishing units were averaging 135-140p/kg for finished animals, which were achieving a margin of 13-14p/kg, helped by an increase in value of about £33 a head on the previous year.

See also: NPA research shows pig welfare differences across world

This was producing sustainable returns for most producers, said Mr Crichton.

“The feasibility of maintaining these margins is reasonably firm.

“European production is down; our production is down and the Chinese market is helping us at the moment.”

Mr Crichton said a shortage in supply was driving the market rather than higher demand.

The latest AHDB Pork figures showed estimated GB slaughterings were 2.2% down on the previous week to 159,600 for the week ending 29 April – 8% down on the year before.

“Everyone would have traded for this position at the start of the year, no one would have dreamed that prices would have been this high,” added Mr Crichton.

But the consultant warned the real test would come post Brexit, when intensive markets such as Brazil, the US and Canada could have trade deals with the UK and flood the market with cheaper, low welfare standard pork.

“What will also hinder us [post Brexit] is going back to square one with Chinese export health certificates which could affect exports,” he added.

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