Inside Pigs
3 reasons why piglet prices will fall
The piglet market is at a turning point. The DCA BestPigletPrice may remain stable this week, but the foundation under the listing is crumbling. What are the 3 reasons for this?
Read this article?
Become a subscriber and get instant access
Choose the subscription that suits you
The DCA BestPigletPrice (BPP) has now been stable for 5 weeks in a row. Apparently this piglet quotation is holding up easily, but pressure on the piglet price is building up beneath the surface. There are 3 reasons for this.
Spanish piglet price down
The Spanish piglet price fell by €1 last week to €52 per piglet. The Spanish price can be seen as a trend setter and a reflection of the free market. The Spanish piglet price is often 1 or 2 weeks ahead of the BPP, both in a rising and falling market. Traders say that sales to Spain are under pressure and that Spanish integrations are bidding back. Recently, bids exceeded €70 per piglet, but these amounts are no longer feasible.
Exports in animal numbers are also declining. In the first quarter, more than 20.000 piglets were exported to Spain almost every week, but this number has been declining for a number of weeks. The figures have been under pressure, especially in the last few weeks. This fits with the seasonal market pattern. A starting point is that exports to Germany are continuing smoothly. However, the shortage on the German piglet market is now behind us.
Stretch out the pork price
An important driver behind the piglet price is pig prices. If pigs become more expensive, the demand for fr piglets will increase. However, in recent weeks, pork prices have risen with effort. The pig market has fallen out of rhythm due to the Hauspreise of German slaughterhouses.
Vion has kept the pig price stable this week at €1,86 per kilo. The slaughterhouse is negative about the meat market and speaks of price pressure in China. July and August are generally weak months, which leaves little time on paper to make progress. This makes fattening pig farmers more reluctant to impose.
Seasonal supply is growing
Although there is not yet an excessive supply of piglets, the seasonal supply has been increasing for some time. According to traders, the DCA BestPigletPrice is struggling to survive this week and the quotation is too high for free market couples.
The statements at DCA-Markets show that traders are opting for a reduction. From a historical perspective, reductions are no longer long in coming. In the previous two years, the quotation had already turned red at this time of year. It seems like a matter of a few weeks before the listing goes down.