Pig prices up, but so are costs

GB finished pig price quotations for supplies in the week commencing 11 April have continued to improve across the board, writes Farmers Weekly commentator Peter Crichton.

Although the Deadweight Average Pig Price (DAPP) only rose from 136.58p/kg the previous week to 137.67p/kg today, weekly contract prices issued by Tulip, Vion, Cranswick and Woodheads moved up by an average of 2.375p/kg.

Sellers of spot bacon pigs have been able to negotiate prices of 2-4p/kg higher than contract rates reflecting an increasing shortage of live pig availability, especially in the more volatile spot market with quotes as high as 152p/kg were available from some of the smaller specialist abattoirs.

The euro has risen over the past seven days from 87.9p to 88.3p, which has also benefited the export market for cull sows with deadweight quotes now between 106-109p/kg on a delivered basis, also reflecting a further hardening in EU mainland manufacturing pigmeat prices.

But GB pig production costs are also under pressure due to further increases in cereal prices which saw ex-farm feed wheat quotes in the £194/t region and forward prices are also reflecting an upward trend.

As a result, although finished pig prices have been rising, weaner values have tended to stay at similar levels with the latest Agriculture and Horticulture Development Board (AHDB) 30kg ex-farm weaner quote pegged at £42.50 a head and significantly below break even production costs.

BPEX recently calculated that producers need to receive deadweight prices in the region of 165p/kg to break even which means the DAPP will have to improve from its current level by almost 30p in the very near future.


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