Stable BestPigletPrice no harbinger of price drop

The shortage on the German piglet market, just like in the Netherlands, is smaller than a few weeks ago and that is why the trend report here also indicates that the German piglet price can remain at 56,50 euros per piglet for the time being. Because the expected supply is slightly more generous in the background, there is no longer any push for further increases in these weeks and both propagator and trader are at peace with this, while the fattening pig farmers are confident of an increasing pig market this spring. 

On average, piglet prices in Europe are 16 percent above average in the period 2012 to 2016. However, the above-average piglet prices in a flattening market are not a harbinger of a price drop in the short term. Because the pig market is probably preparing for a good season, more 'speculative fatteners' are also entering the market. Particularly in Eastern Europe, there are relatively many casual fatteners who are happy to get involved when pig prices are rising. This 'extra demand' could provide strong support for piglet prices in Europe in the coming weeks.

As expected, Vion also leaves the pig price at 1,55 euros per kilo, with the slaughterhouse stating that the meat market is still set in stone. There are sounds from Spain that additional benefit can be taken from Chinese demand now that Tönnies is sidelined for the time being. This also translates into the Spanish pig price.

Some traders expect that Germany will be ready for the third price increase of 2017 on Wednesday. The first increase of 5 cents in week one was reversed in week two, because the meat market could not absorb such an increase. The second increase – of 5 cents again – also turned out to be a disappointment, because slaughterhouses did not go along with this. Three times is usually a charm, but the NordWest Commission is cautious about using this option for the time being. Yet a price increase may be close, as some traders in the Netherlands have heard that this will already be the case on Wednesday. 

With limited space at the top and a sturdy bottom, the DCA BestPigletPrice remains at 54,50 euros per piglet. Historically, the piglet market usually reaches its highest point of the year in week 16. However, often at lower levels than the prices at the end of February.

If the piglet market wants to take another step upwards, the pig market must in any case take action quickly. After all, that's where the space has to come from. Otherwise, it is not unrealistic to think that the piglet market has already reached the highest point of 2017 at the end of February and will then look for the seasonal rhythm. 

Graphic: NordWest piglets