Pig prices improve, but margin pressure remains

Spot and contract pig prices have continued to improve over the past week, with the Deadweight Average Pig Price rising from 135.60p to 136.58p/kg, writes Farmers Weekly commentator Peter Crichton.

Weekly contract prices issued by Tulip, Vion andCranswick also rose by an average of 1.75p/kg, with more increases in the pipeline as pig numbers continue to contract while retail demand improves.

Spot bacon was traded within a fairly wide range, reflecting something of a north/south divide, with quotes anywhere between 140-150p/kg according to region and specification. With soaring lamb and beef prices, all the signs are that pig values will continue to improve in the weeks ahead.

Further improvements in the value of the euro, which closed on 1 April worth 88.1p, have also boosted the cull sow market, where quotes of between 105-107p/kg deadweight are available. Better European demand has also helped.

But the weaner market continues to reflect high cereal prices with the latest AHDB 30kg ex-farm average quoted at £41.43 a head, well below producers’ production costs.

Despite rising pig prices, most pig producers are still operating on negative margins, with feed wheat now quoted on an ex-farm basis at £194.50/t, over twice its value this time last year.

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