Market commentary: You Can't Always Get What You Want
6th Oct 2017 / By Peter Crichton
Pig prices are unfortunately continuing on their relentless downward track, with the SPP losing another 0.6p to stand at 160.44p/kg and weekly contribution prices also drifting back by between 1p-3p/kg.
The German producer pig price continues to fall losing another 3 Euro cents this week, which means it has dropped by 20 Euro Cents over the last four weeks which, in our money, is equivalent to a drop of £15 per pig.
With cheaper imports continuing to penetrate the UK market, spot prices have remained under pressure and although regular spot sellers have, in most cases, been able to agree prices in the 150p/kg region, out of the blue one-off loads of spot pigs with no particular home to go to have been hard to place and might, in some cases, be worth no more than 140p/kg.
With the 'C' word (Christmas in case you were wondered) on the horizon, wherever possible, producers are advised to send a few extra pigs in the weeks ahead to prevent weights going through the roof and pigs being rolled, which is easier said than done with very little extra space available.
One shaft of light has been the improvement in the value of the Euro which a week ago traded worth 88.2p and by noon on Friday was worth 89.7p. As a result, although German sow prices are reported to have stood on over the water, the currency change put an extra penny into UK cull sow buyers’ pockets with most quotes now in the 78p – 82p/kg region.
Weaner prices continue to reflect their finished pig counterparts with spot quotes significantly lower than contract but, although the AHDB 30kg ex farm weaner average slipped £1.91/head to £58.31/head, 7kg averages actually improved by £1.26/head to £44.03/head. But this trend is unlikely to continue with most weaner prices based on the SPP, which continues to fall and the spot market is certainly not a place for faint hearted sellers, who are suffering a significant discount when compared with contract prices.
The commodity markets ended another relatively quiet week, with little movement in London and Paris-based wheat futures and although UK rape seed values dropped during the week, the US soya bean market also eased.
UK LIFFE feed wheat traded little changed at £143.10/t for November with March 2018 at £147.20/t.
UK end of September trades for proteins saw 48% soya meal traded ex-Liverpool at £304/t and 34% rape meal ex-Kent at £159/t.
And finally, more warnings on the biosecurity front with Swine Fever still a potent killer in parts of Eastern Europe. The NPA has now issued a reminder to pig producers of the dangers of feeding waste food, either deliberately or by accident, to their pigs.
Although there is a temptation for people to feed waste food to pigs, there are huge risks attached and producers should think long and hard before using any non-accredited sources of feed. The last thing we want to see is a return to the dark days of Swine Fever in 2000 followed by FMD in 2001, both of which outbreaks appear to have been linked to waste food or a casually discarded ham sandwich and many in the industry still bear the mental scars of the mass slaughter of livestock which ensued.