Prime pig prices follow ‘seasonal trend’
Farmgate prime pig prices are said to be following ‘traditional seasonal decline’, with producer prices dipping slightly since the start of the year, according to the latest market analysis by Quality Meat Scotland (QMS).
GB prices are 6% lower according to Stuart Ashworth, QMS director of Economics Services, when compared to a year ago.
This is a steeper decline than that seen in the current beef market, where prices are 4% down on the year, and the prime sheep market where prices are very similar to last year.
Contributing to the weakness of farmgate prices has been an increase in actual pigmeat production. Over recent weeks, around 1% more pigs have been slaughtered compared with the same period last year, and carcase weights are just over 1kg heavier.
In contrast, according to Ashworth, the wider European average price has also drifted lower in the past month but has generally lacked direction for the past quarter and currently stands around 1% higher than last year.
However, major producers like Denmark, Germany, Spain and France are all currently benefiting from prices higher than a year ago.
“UK producer prices are well above the EU average, making the UK an attractive tariff-free destination for many European producers,” he said.
“Like many others, however, pig producers in the UK and Europe will be nervous of what sort of Brexit materialises and whether the UK adopts tariffs on pigmeat imports or not.”
Other major pigmeat producers are, however, seeing farmgate prices under pressure.
The United States is currently reporting prices 25% lower than a year ago, while Brazilian producer prices are 10-15% lower than a year ago.
Even China is seeing prices down around 10% on the year, despite production being affected by measures to control African Swine Fever (ASF) and the trade dispute with the US, which has reduced imports from this source.
Mr Ashworth added: “In the current climate, UK pigmeat exports will be affected by how EU and non-EU countries react to the UK leaving the EU and the status of approvals to export.
“Similarly, European exports to non-EU countries may be affected by restrictions imposed on member states affected by ASF.” he concluded.