Inside Pigs
Piglet yields continued to decline in July
July was another weak month for pig farmers. Quotations of piglets and pigs were under pressure. For fattening pig farmers, however, the profitability at the end of July was slightly higher than a month earlier. The falling piglet prices more than compensated for the falling fattening pig prices.
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In June, fattening pig farmers also managed to limit the damage due to the sharp drop in piglet prices. As is often the case at this time of year, demand for piglets is quiet. This year the effect has been reinforced by the uncertainty surrounding African swine fever in Germany and the sharp decline in Chinese demand for pork. And although fattening pig prices are also falling, piglet prices are falling even more sharply in proportion.
DCA Fattening pigs Index
The returns of fattening pig farmers increased slightly during the month of July. While the index stood at 26 at the start of the month (week 101,9), by week 30 it had risen to 111,4. The return was therefore slightly above the long-term average.
This despite the fact that the DCA Stock Price 2.0 was no less than €0.05 lower in the last week of July. The quotation in week 30 was €1,41 per kilo of slaughtered weight. This means a loss of income per pig of around €5,00 per pig. However, piglet prices fell faster.
In addition to changes in pig and piglet prices, fattening pig farmers are confronted with higher prices for compound feed. Although the largest increase appears to be behind us, pork chunks became €0,10 more expensive and were listed at €28,40 in July. Starter feeds became €0,15 more expensive and cost €32,85 per 100 kilos.
DCA Piglets Index
The DCA Piglet Index continued the nosedive that started in May and once again had to give up significant ground. The index fell from 81,7 points in week 26 to 53,8 points in the last week of July. The return in the propagation sector is now well below the 5-year average. The main cause is the sharp drop in prices for piglets. The DCA BestPigletPrice had to give up €7,50 and amounted to €31,00 per piglet at the end of the month. The price for slaughter sows remained virtually stable in July.
In addition to the price boom for piglets, feed for breeders became more expensive again. Sow pellets were €0,25 more expensive in July, with gestation pellets trading at €29,65 and lacto feed at €34,10 per 100 kilos. Baby piglet pellets became €0,35 more expensive. The price for this chunk is €40,10 in July.
The prospects for the coming months are not very rosy. In the first weeks, piglet and pig quotations had to take a step back again. Moreover, compound feed for pigs will certainly not become cheaper in August. Returns in the sector will remain under pressure for the time being.