Inside: Pig Market
German butchers put blunt ax in pig price
The start of 2018 is unfavorable for the pig market. A large supply in Europe means that the quotations in various countries are under pressure. To the chagrin of German producers, Tönnies takes the cake with a reduction of €0,07 per kilo.
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The reductions in the German pig market are of unprecedented proportions. This while almost everyone thought last week that there was a solid bottom under the price. However, this week the large slaughterhouses are putting the blunt ax in the payment price.
For example, Tönnies reduced prices by €0,07 to €1,30 per kilo. Westfleisch also quotes €1,30, a minus of €0,05 per kilo. In doing so, they went further than the German pork price (VEZG), which fell by €0,03 to €1,34. In the south of Germany, some smaller slaughterhouses appear to apply a 'hauspreis'.
Many sow prices also fell faster this week than the North/West committee prescribed. While the VEGZ quotation fell by €0,03 to €0,95 per kilo, Tönnies decreased by €0,07 to €0,83. In the Netherlands, Tijs Haarle lowered by €0,07 to €1,08.
Deliver ahead
A large pig supply and a strong euro keep the price down. Last week, 264.000 pigs were slaughtered in the Netherlands. That is a lot for a broken slaughter week (due to New Year's Day). The pigs are heavy (average 98 kilos). This means that many pig farmers will probably come up with a lot of supply again in the coming weeks. Especially now that the pork price is under considerable pressure. Last week, 861.087 pigs were slaughtered in Germany. These weighed an average of 98,70 kilos, which is heavy.
Danish Crown stated this week that the pig market is being held back by 3 price-pressing factors. To wit: a large European pig supply, a strong euro and little demand for fresh parts. According to the slaughterhouse, the headwind is stronger than usual in January. In terms of volume, demand outside Europe is fairly stable. However, the strong euro against the Japanese Yen and the dollar is cutting into revenues.
Pig farmers displeased
German pig farmers and advocates view the devaluation of the pig price with suspicion. The fact that the large slaughterhouses are making adjustments in this way is a lack of respect for the producers. Some medium-sized slaughterhouses that do follow the VEGZ listing can therefore count on more understanding. The losses suffered these weeks are now often the responsibility of pig farmers and the trade.