Inside Pigs
Ice cream below pig prices remains paper thin
Although the panic in the pig market has ebbed, there is certainly no sign of stability yet. In the background, sow prices received a sharp correction this week and, moreover, the pig supply remains oppressively large.
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These are special times on the pig market, about which much has already been said and written. The wind is against us on all fronts and there are no impulses. There is an overall minor mood. Meat stocks in Europe are piling up and the pig supply is ample. And as in so many sectors, there is a major shortage of personnel, both on the farm, in meat processing and in logistics.
Many slaughterhouses suffer from a lack of deboning capacity. There are major concerns about whether meat processing can continue at full capacity, especially when the pig supply will increase further in the coming weeks. The slaughter plans may be adjusted accordingly, with all the consequences that entails.
Lidl is also going to stunt
To name a possible starting point: This week Lidl indicated that it wanted to start doing stunts with German pork to reduce stocks. The discounter wants to offer pork in all 3.200 branches in Germany in the short term. Lidl is thus following the example of Aldi, which previously unveiled such plans. The measures taken by the supermarkets may provide a solution, but at the same time they underline the impasse in the pig market at the moment.
What will pig price do?
In the short term, the pressure on pig prices has faded into the background. The German VEZG quotation remained unchanged on Wednesday at €1,25 per kilo and slaughterhouses also kept their quotation unchanged. The question on many people's minds is whether pig prices will continue to fall. Based on the past year, a stable pig price (VEZG) is likely in the coming weeks. Judging from current market conditions, we can only conclude that the ice under pig prices is wafer-thin.
For next week, most traders at DCA Markets opt for unchanged. The DCA Exchange price for slaughtered pigs is €1,24 per kilo. The price of live pigs is €0,94.