Compiled by FWi staff
Pig prices remained below last years levels for the whole of 1997 – largely because of the strength of Sterling. But UK producers were able to take advantage of swine fever outbreaks on the Continent and export some surplus pigmeat for much of the year. Unfortunately, the UK market remains over-supplied and pig farmers this Christmas face their lowest seasonal prices ever in real terms.
- Pig farmers should closely watch currency movements in the year ahead, warns Mick Sloyan of the Meat and Livestock Commission. Pig values in Denmark are the same as last year but, when expressed in Sterling, those same prices are 14% cheaper because of the Pounds strength. This and the expected 2.2% rise in slaughterings to 14.2 million will mean a lean 1997 for pig farmers, Mr Sloyan says.
Despite the strength of Sterling, pork exports rise in the wake of swine fever outbreaks on the Continent. Sales to the rest of the EU are up by one-fifth on a year ago during the week ending 15 February, according to MLC statistics. The average all-weight spot price is about 84p/kg.
Over a million pigs face being culled in Holland, following the outbreak of swine fever. UK spot prices reach 84p/kg.
- The average auction price of pigs shoots up again, rising 16p/kg to 110.84p/kg. Following the swine fever outbreak on the Continent, Japan is reportedly looking elsewhere for supplies.
- Pork exports rose to record levels during 1996, gaining market share both inside and outside the EU, according to the MLC. But the looming deadline for removing sow stalls in the UK is a major challenge for the industry, says pigmeat strategy manager Colin Baldwin.
Pig industry opinion is split as to where prices are heading. The MLC suggests that any fall in the coming months is unlikely. But other sectors of the industry say consumer demand has decreased and prices have peaked.
Expansion of the UK pig herd pushes prices down. Clean slaughterings during the first six months of the year are were up almost 10% on the first half of 1996.
The all-pigs average spot price stands at 82.5p/kg liveweight. A year ago, it was more than 106p/kg. Although supplies are tight on the Continent, the strong Pound makes the UK a favourite destination for EU exporters.
UK pig prices tumble, despite the effects of disease on the Dutch industry. Spot values fall to less than 67p/kg liveweight. The strong Pound continues to work against British exporters, reports the MLC. Imports are being sucked in, upsetting the fine balance between supply and demand, says Graham England, NFU pig committee chairman.
The UK market continues to be heavily supplied, with many pigs going for slaughter, according to the MLC. Slaughter numbers are up 6-8% on the year and demand is estimated to be down by about 25%.
A boom in pigmeat supplies from abroad and the increasing strength of Sterling combine to create a seemingly bleak picture for producers. Reports of imported Dutch pigmeat being sold as “Charter Quality British Bacon” do little to boost morale in an already depressed sector.
- In the short term, pigmeat supplies will remain high, says MLC head of pigmeat strategy, Mick Sloyan. But demand is expected to pick up slightly during the Christmas run-up, he adds.
Current returns for all but the most efficient producers are well below the break-even levels of 110p/kg deadweight and £32/hd for weaner breeders.
- The sharp fall in prices is attributed to an influx of Dutch heavy hogs entering the slaughter chain. Dutch producers have held back until now to enable their pigs to reach their Government-financed minimum carcass weight level.
THE European-wide decline in pig prices shows some signs of levelling out. Reports from live auction centres across the UK show most prices range from 58-65p/kg – within 2-4p/k of producer values.
- But in real terms, the industry is looking at its worst seasonal prices ever. Seasonal returns to producers remain at their lowest level for 17 years, before adjusting for the value of Sterling.