Inside Pigs
It's hard buffalo at the pig market
The pig market is still in a difficult position due to the oversupply of pigs ready for slaughter, a very lackluster demand for pork in Europe and the Chinese export ban. How does the DCA Scholarship 2.0 react to this?
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The pig supply was ample, is now (almost) impossible to manage and the sales problems remain as great as ever for the time being. Although Tönnies can start again from week 30, the problems have not yet been resolved. Time is needed to smooth out the oversupply of several hundred thousand pigs. It is difficult to estimate how much time this will take, according to traders. The aftermath is expected to last at least a month.
Poor meat sales
And then there is also the export ban on pork to China that Vion, Van Rooi Meat and also Tönnies are confronted with. In addition, meat consumption in Europe is at a low level. Due to the corona issues, pork is less popular. The demand for meat parts on the spot market is very tame, various parties indicate. Moreover, stocks are ample, because Tönnies (and other slaughterhouses) have been out of business for a while. Outside Europe, exporters now mainly rely on sales to Japan, although American competition in that market is quite stiff.
The rainy weather of recent weeks was also not a catalyst for higher meat consumption. Although the precipitation will decrease in the coming week, there will be no summer temperatures. This means that the erratic BBQ demand will not materialize for a while, while the meat market could use that incentive.
Bottom in the market?
In terms of mutations, the pressure seems to be off somewhat. Although the reduction in the German pork price from 13 cents to €1,47 per kilo is significant, the Dutch slaughterhouses made more moderate cuts. A bottom seems within reach, although slaughterhouses are voting for further reductions. All in all, the pig market is in a phase where limiting damage is the maximum possible.
From that point of view, stabilization would be desirable to achieve more peace in the market, traders indicate. Based on the statements, the DCA Exchange Price 2.0 remains the same at €1,33 per kilo for pigs slaughtered. The price of live pigs remains unchanged at €1,05 per kilo. Due to the still great uncertainty, the quotation has been determined provisionally, just like last week. The final publication will follow on Wednesday evening, July 15 at 20.00 p.m.