Over the million
Hauspreis Tönnies noose for pig trade
Pig prices in Germany are back on par, but the cold is not over yet. According to the ISN, the representative of German pig farmers, the damage to large pig traders is in the millions of euros.
Most fattening pigs in Germany are settled on the 'Vereinigungspreis'. From week 29 to week 31, it noted €1,70 per kilo. Tönnies and Vion Germany, however, applied a haus price of €1,67 per kilo in the same weeks. The difference of 3 cents mainly has financial consequences for pig traders, because they are forced to close the hauspreis out of their own pockets for 3 weeks. For example, the ISN claims that the damage at the large merchants amounts to a six-figure amount.
Years of suppliers of Tönnies are therefore somewhat annoyed. Especially since the slaughterhouse also announced at the beginning of July that it would withhold 0,2% of the pig price, in order to be able to continue to apply the payment term of a maximum of 5 days.
The question is why
The ISN wonders what drives Tönnies to cut the pig trade twice in a short period of time. If the meat trade were that bad, other slaughterhouses could not pay higher either. It is also striking that Tönnies Livestock, the trading arm of the meat group, allegedly did not apply a haus price to its integrated producers. In other words: it suggests that the own, integrated pig farmers are favored.
According to the ISN, the actions of market leader Tönnies are a signal that the slaughterhouse is working on the structures of the free market. It should therefore make pig farmers and traders think about the long-term consequences.
Wouter Job
© DCA Market Intelligence. This market information is subject to copyright. It is not permitted to reproduce, distribute, disseminate or make the content available to third parties for compensation, in any form, without the express written permission of DCA Market Intelligence.
