Inside Pigs
Pig market remains in the grip of ample supply
With an extremely wide range, the pig market is entering the broken weeks around Christmas and New Year. Although this presents the necessary challenges, the pressure on the pig price is not extremely great at the moment. However, the coming weeks will be challenging nonetheless.
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The fact that the price pressure is not extremely great these weeks is of course also due to the heavy price fall earlier this year. The German pork price (VEZG) has been trading at a paltry €1,19 per kilo for a few weeks now. With 2 broken slaughter weeks ahead, the supply is ample, but that will not be a surprise.
Almost Christmas holidays
The meat market has two faces. In the short term there is a lot of retail demand for traditional Christmas products such as hams and tenderloins. Sales of Beter Leven pigs in particular benefit from this. On the other hand, the meat processing industry is on the eve of a holiday period, in which many companies are shut down. This also means that sales of carcasses and cuts are stagnating.
It is still uncertain in what mood the market will start the new year with the ongoing corona issues in the background. Good Asian demand will be necessary during that period to relieve the full European meat market.
Offer remains the cliffhanger
The pig supply will also be ample at the beginning of 2021, especially in Germany. That is why Tönnies has decided to extend the priority given to heavy pigs from regular suppliers until the end of January. The supply will remain the market cliffhanger for the foreseeable future and it cannot be ruled out that this will continue to cause price pressure.
However, the DCA Exchange Price 2.0 may remain stable towards next week. The price of slaughtered pigs is €1,20 per kilo and the price of live pigs remains at €0,90 per kilo.