Trading patterns lift pig price prospects

Friday, 3 September, 1999

By Peter Crichton

AFTER almost 18 months of negative prices signs are emerging of slightly better trading patterns in the run up to the millennium.

The recent Food Aid to Russia scheme has at long last taken significant tonnages of manufacturing grade pigmeat out of EU cold stores.

This has helped to lift EU heavy pig prices and has also lifted cull sow returns to their highest levels since March 1998.

Latest UK cull sow quotes have been in the 65-68p/kg deadweight band which values the average cull at about £90/head.

Finished pig prices in the “big 6” production countries have levelled up to some extent on a pence/kg basis although in the UK our average carcass weight is the lightest of the group at 71kg.

French, German and Dutch weights are all quoted at about 87kg and each case their bottom line deductions are up to 70% lower than in the UK.

UK slaughter numbers are also tightening up and now that the last of the Bank Holiday “short weeks” is over and the schools reopen spot quotes are estimated to improve in the weeks ahead.

However, trade sources disagree with earlier MLC predictions that these could hit 110p/kg and feel the autumn average is likely to remain closely linked to other EU prices in the 85 to 95p bracket.

Domestic feed prices are also tapering off for the September to November period with leading compounders quoting sow rations as low as £99/t and 19.5% finisher pellets at £107.

Although home mixers and waste feeders will be able to beat these prices the compounders prices show a drop between 10 and 14% on the year.

This feed cost saving is worth up to £2/head for a typical breeder finisher selling bacon pigs.

These savings are due to a combination of factors including a high yielding feed quality UK harvest, bumper US soyabean plantings and yields and the strength of the Pound.

Grain traders advise letting the domestic market find its own level in the coming four to six weeks before locking in to six to 12 month feed supply agreements.

  • Peter Crichton is a Suffolk-based pig farmer offering independent valuation and consultancy services to the UK pig industry

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