Inside: Pig Market

Pig market finally finds its way

18 May 2018 - Wouter Baan

The situation on the pig market is a lot rosier than, say, a few weeks ago. The desired increases are actually implemented in the quotations. The DCA Stock Price 2.0 is also taking a significant step up.

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The pig supply in Northwestern Europe still has one hurdle to overcome. In the sense that there is still 1 broken slaughter week to come, due to the loss of 1 slaughter day at Pentecost. Yet the market is not affected by this. In Germany the pig price (the VEZG quotation) increased this week by €0,05 to €1,43 per kilo. These movements were followed, without too much resistance, by the large German slaughterhouses.

Prelude to more
In the Netherlands, the quotation at Compaxo increased by €0,02 to €1,25 per kilo. Westfort's quotation increased by €0,01 to €1,26 per kilo. These movements can be seen across the board as a prelude to higher pig prices. Especially because the Internet fair further fueled expectations in the market on Friday, May 18. The quotation moved the limit upwards again by increasing by €0,04 to €1,50 per kilo.

These are movements that many pig farmers are waiting for. They have so far been confronted with increasing costs feed, a fertilizer prices, while on balance the pig price has hardly increased this year.

The demand for hams is also increasing somewhat 

Improvement in the meat market
European slaughterhouses are talking about better sales opportunities on the meat market. For example, Danish Crown reports that the demand for meat parts for the BBQ has increased considerably in recent weeks. This causes the ample meat supplies to decline and that is something that offers upward potential for the pork price. Sales of hams are also increasing somewhat. The weather forecasts pretty good looking forward to next week.

It is a well-known story that sales to China are less successful. However, the negative sentiment does not apply to all Asian sales. For example, sales in Japan are stable to good. Sales in the United Kingdom (UK) are again somewhat disappointing. For example, bacon imports fell by 25% in the first quarter to 46.000 tons, of which the Netherlands is an important supplier. Imports of pork and slaughter by-products also fell significantly. On the other hand, British imports of processed meat products increased somewhat. In percentage terms, Denmark (-36%) lost the most. Dutch exports increased 6%.

Offer increasingly clear
In Germany, the supply is drying up more due to good demand for pigs. The supply is still ample in the Netherlands, but this will probably change in the coming weeks when the broken slaughter weeks are a thing of the past for the time being. A positive point in this regard is that the average slaughter weight fell by 30 grams last week to 96,60 kilos. This means that there are fewer and fewer heavy pigs.

Based on the positive trend in the market, the DCA Exchange Price 2.0 will therefore increase by €0,05 to €1,36 per kilo for the slaughtered pigs. The price of live pigs increases by €0,04 to €1,09 per kilo.

DCA Scholarship 2.0 (week 21) Price range Number of problems  Average
Gender €1,36 (+€0,05) per kilo € 1,34 - € 1,37 13 €1,356
Living €1,09 (+€0,04) per kilo € 1,07 - € 1,10 12 €1,087
Explanation DCA Markets: Germany sets the tone, so the Netherlands cannot lag behind. That is, in short, the situation on the Dutch pig market. Although we will still have to deal with a broken slaughter week in the coming week due to Whit Monday, the signals are becoming stronger that a week with a shortage in the supply of pigs is imminent. Due to the weather, the pigs are growing less quickly and supply is being exercised with caution. Traders who sell pigs on the German market indicate that the appetite for pigs is greater than in the Netherlands. A further increase in the pig price cannot be ruled out next Wednesday. 

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