SPP hits record high, says AHDB

SPP hits record high, says AHDB

According to AHDB, the EU standard pig price (SPP) has hit a record high in the month of July, reaching up to 225.4p in the last week of July.

For the first time in the last 10 quarters, cost of production has had a positive net margin.

When compared with the previous month, prices rose 2.1p while weekly gains averaged 0.3p. SPP was almost 30p up by the end of the month when measuring against the 2022 July prices, and it was up more than 60p from the five-year average.

AHDB data shows an average of 153,400 pigs were slaughtered per week in July, taking the monthly total per head to 613,400. Though prices were up, July saw a fall in head, with 1,800 less than June and 118,500 less than the same period in 2022.

There was a 370g increase in carcase weights compared to those seen in June, averaging 88.9kg in July. In the final week of July, average rates sat above 89kg.

Production costs in Q2

Due to feed costs falling and pig prices rising, the estimated cost of production for Q2 2023 was 196/kg, putting net margins at £22 a head and +25p/kg. This was the first positive net margin for the last 10 quarters.

Feed costs are now at an approximate 123p/kg for Q2 2023, decreasing 52p from the same period in 2022. In the previous 10 consecutive quarters, feed costs had risen from about 100p/kg in Q3 2020 to a peak of 175p/kg in Q2 2022.

The increased building material costs following the global pandemic saw overall building costs rising by 12p since Q3 2020, increasing the cost of production. Increased interest rates and finance costs also contributed to the rising costs.

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