Uncertain pig market no blockage for DCA Stock price

While the German pig market picked up in the first week of March - after a few slow winter months - the market expected prices to rise at a steady pace. Until Wednesday afternoon there was actually no problem, especially because the meat market also responded reasonably positively to the first price increase of 2 cents. In principle, all lights were green on Wednesday afternoon for the Nordwest committee and the slaughterhouses to jointly implement a second increase.

The 'vereinigungspreis' increased by 3 cents to 1,57 euros, were it not for the fact that the largest players in Germany threw a spanner in the works by announcing a hauspreis. This is much to the annoyance of German pig farmers. The internet stock exchange gave a considerable counter-reaction to the high price of Tönnies and Vion Germany on Friday and fell by 2 cents to 1,60 euros per kilo. The way the cards are now shuffled, there is a good chance that the Vereinigungspreis and the slaughterhouse quotations of Vion and Tönnies will meet in week 11. The only question is whether it will be the slaughterhouses that will catch up after all, or whether the Nordwest committee will be dismissed. .

Supply-driven market
It is too early to make any statements about this now, but given the reaction of the internet stock exchange, the positive trend of recent weeks has been temporarily interrupted. Based on the current market situation, as evidenced by the tight pig supply and slaughter figures, there are weeks during the year when a hauspreis is more defensible than is currently the case. Because Tönnies is currently on a China restriction, this is somewhat understandable. The fact that Vion Germany makes good use of the situation by also listing unchanged is considered childish in the market, especially because Danish Crown and Westfleisch did go along.

By the way, people reacted to it with surprise news that Ingrid Jansen and Eric Douma have left the POV. Especially because the news literally fell out of the sky and especially because the paths parted immediately. That is striking and there is no other way that there is more going on in the background, or so the thinking goes. 

The backs (+0,03), hams, shoulders and bellies (+0,02) all recorded a plus in week 10. For next week (week 11), the supply is generally tight to normal. Some lots are fairly full, others still have some space left. On balance, expectations in the market are reasonably positive, although some room for maneuver is being avoided, given the situation in Germany. Nevertheless, there is sufficient support to increase the DCA Exchange Price 2.0 by 2 cents to 1,52 euros per kilo. Live pigs also increased by 2 cents to 1,21 euros.

For the coming weeks, it is stated that the pig supply in particular must provide the incentives to increase and that the meat market can only respond, but shows little initiative on its own.

The slaughter figures for week 9 are down compared to the previous week. In Germany, 974.226 pigs were hanging on the hooks, which is 1,4 percent below the five-year average. The Dutch slaughter figure, at 285.000 animals, is significantly behind the 2016 level. Last year in week 9, the slaughter figure was still 300.000 pigs.

The average weights in the Netherlands and Germany were 96,09 and 97,52 kilos respectively. This means that the Dutch pigs weigh more than a kilo more than last year and also well above the five-year average, which means that the pigs are considered heavy.