Signs of optimism emerging for pig producers

Something of a buyer’s market is starting to emerge with spot buyers looking for extra pigs on the back of a slight improvement in prices, writes Farmers Weekly commentator Peter Crichton.

The GB Euro Deadweight Adjusted Pig Price rose from 144.8p/kg to 144.92p/kg in the week ended 7 October. Also, reports of reduced supplies of imported European pigmeat, coupled with a slight improvement in the value of the euro – which closed last week worth 86.38p – are also painting a slightly more positive picture for UK pig producers.

As a result, spot bacon was generally traded in the 145-147p/kg range (+2 or 3p) and two of the four major contract buyers also lifted their shout prices by 1p and these now read as follows:

• Woodheads: 145p/kg (no change)

• Cranswick: 142p/kg (+1p)

• Tulip: 142p/kg (no change)

• Vion: 141p/kg (+1p)

Cull sow quotes have also been helped by a relatively firm euro with export abattoirs prepared to pay prices in the 110p/kg region on a delivered basis, according to specification.

The better outlook for finished pig prices has also influenced the weaner market which after several months of falling values is starting to bottom out with the latest Agricultural and Horticulture Development Board 30kg ex-farm weaner average at £39.98/head, but some spot sales are now reported to be £1-2 above this level.

Feed prices are also showing a more favourable trend as far as pig producers are concerned with ex-farm feed wheat quoted at £141.08/t and LIFFE futures prices also falling with November feed wheat down by £3 to £147.50/t last week.

Although many pig producers’ margins still remain in negative territory, further reductions in feed prices and higher pig values should help to reverse this trend in the run up to Christmas.