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The price of maize core chunks rises sharply

1 May 2020 - Jorine Cosse

The price of beef chunks will continue to rise in April, according to the latest figures from Wageningen Economic Research. The price of maize kernel chunks in particular is rising sharply. What does this have to do with and what are the expectations for next month?

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In March, silage maize core chunks recorded the strongest increase with an increase of €0,40. The price will also increase the most this month. With a significant increase of €1,40, bringing the price to €34,40 per 100 kilos. This means that the price of silage maize core chunks has reached a record high. Such a high price has never been recorded since the price was recorded in 2015. The previous highest quotation was from November 2018. The price was then quoted at €33,85 per 100 kilos.

Standard chunk A and Protein-rich chunk
The prices of standard chunk A and protein-rich chunks increased last month by 'only' €0,10 per 100 kilos. Prices for April are a different story. The standard chunk A price increases by €0,50, resulting in a price of €24,15 per 100 kilos. This does not exceed the highest price ever recorded (€26,60 in 2013), but the price of April last year (€23,65) and the 5-year average of €22,27 are significantly exceeded.

The price of the protein-rich chunks is also increasing considerably. The price increases by €0,40 to €26,40 per 100 kilos. This seems to have definitively overtaken the decline that was visible at the end of 2019. The price is not yet close to the highest price level of €30 that was recorded in 2013. The price of April last year (€26,20) is narrowly exceeded, as is the 5-year average of €25,04. falls further behind.

Beef bull and pink calf chunks
The prices of beef bull and rosé calf chunks have increased by €0,25 to €25,35 and €0,30 to €27,35 respectively. Both chunk prices follow virtually the same trend. Both the price of beef bull chunks and that of the pink calf chunks are the same as those of April 2019. There is variation in the difference with the 5-year average. For example, the price of beef bull chunks is one euro higher than its 5-year average and the price of pink calf chunks is €0,95 higher than its 5-year average.

What explains the significant increase?
The significant price increase of silage maize core chunks is probably due to a combination of various factors. For example, the soy and corn prices recovered in early January from a small price trough that had occurred in the last quarter of 2019. The soy price was listed at almost $350 per tonne and the corn price was $155 per tonne. After the first 2 weeks, both prices dropped again. The influence of raw material prices normally has an effect on chunk prices a few months later

Another possible explanation is the limited supply of protein-rich products such as spent grains and feed potatoes on the feed market. If livestock farmers compensate for this protein shortage by feeding more pellets, this will affect demand and therefore also the price.

In the forecast of the Boerenbusiness compound feed price indicator a price increase is expected for several more months. It now appears that the price will start to fall again from August.

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