Inside Pigs
Sixth reduction in a row for DCA Stock Price 2.0
The situation on the pig market appears to be fragile, although the relaxation of the corona measures in many countries offers some perspective. How does the DCA Stock Price react to this?
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Never before has the price drop on the pig market been as great as it is now. In the past 10 weeks, the pig market has not taken off a jacket, but a thick winter coat. The VEZG quotation fell by no less than 42 cents to €1,60 per kilo and is therefore sliding further into the danger zone with regard to the cost price.
Relaxation of measures
In the meantime, there is more clarity about the end of the 'intelligent lockdown' in the Netherlands. The measures will be carefully relaxed in the coming weeks. Also in other countries. This obviously offers a glimmer of hope, but not much more than that. The stocks that have been created in recent weeks will continue to work against the market for the time being. In addition, 2 slaughter days will be canceled until the end of May due to Ascension Day and Pentecost. In short: the situation remains tense, but not hopeless.
It now appears that several European slaughterhouses are also being plagued by the coronavirus. After Müller Fleisch, Vion (in the Netherlands and Germany) and Westfleisch have also been hit hard. The slaughter capacity for pigs is under pressure in Germany. Further reducing slaughter capacity or closing slaughterhouses seems to be becoming more realistic in Germany by the day. If this becomes practice, a new episode will be added to the book: 'Corona and its consequences for the pig sector'.
DCA Stock price lower again
The pig supply will be more than sufficient for next week. Due to falling prices, the desire to supply pigs remains high. However, there are several reports from traders indicating that the specified numbers of pigs will be (well) absorbed by the slaughterhouses in the coming week. Those who express different opinions about this also depend on sales on the German market every week. This will be virtually closed to Dutch pigs for the first few days of the coming week, with options available later in the week. But then the prices that will be announced next Wednesday apply and are expected to be at a lower level.
DCA Markets' explanation of the quotation for week 20 makes it clear that a large number of expected prices are once again missing out. Just like last week, picking the right chord by pig traders seems to be difficult. The DCA Exchange Price 2.0 for slaughtered pigs drops by 7 euro cents to €1,43 per kilo. The price of live pigs drops 4 euro cents to €1,14.