The pig market is still impulseless

The omikron wave comes at an inopportune time for the pig sector. Where the supply of pigs in January is often too large, the processing capacity of slaughterhouses is now also severely limited. This makes it difficult to place all the animals on offer, which is also evident from the high average slaughtered weight (101,60 kilos in week 2).

In addition, more than 11.000 pigs (often heavy and difficult to place) crossed the border in the first two weeks of the year; mainly to Poland and Spain, but also to destinations such as Italy, Slovakia, Hungary and Romania. This is evident from the figures from the Netherlands Enterprise Agency (RVO.nl).

Is the German supply structurally declining?
The number of slaughters in Germany was at a low level in the first three weeks of the year. In week 3, only 793.000 pigs were processed in German slaughterhouses. The lowest number for this week since at least 2008. Despite the low slaughter numbers, not many pigs remain in the German stables (due to the low processing capacity). The average slaughtered weight in week 3 was 97,2 kilos, a decrease of 0,2 kilos compared to week 2 when the pigs still weighed an average of 97,4 kilos. It is a signal that the German pig supply will not be much larger in the coming period and that pork production will shrink further.

The fact that the development does not have a positive effect on prices is partly due to the fact that the supply for the available slaughter capacity is sufficient, as well as the weak meat trade. In the Dutch pig trade it is noticeable that German slaughterhouses are not interested in purchasing Dutch animals. In addition, Dutch slaughterhouses also have to deal with limited slaughter capacity due to corona infections. There are therefore sufficient animals available for slaughter and the supply still feels ample (measured against demand).

Meat trade difficult, prices stabilize
Although the meat trade is still described as lukewarm, the quotations for various pig parts are stabilizing, according to the price quotes for the DCA Pig Parts quotation. Only 'meager matins' are trading on average €1,67 cents lower. The limited slaughter capacity means that the supply of meat remains within limits and cannot put further pressure on the market.

We are waiting for impulses in the meat trade that will hopefully come with the relaxation of the corona measures, preparation for warmer weather and a shrinking supply. For the time being, however, the starting points are limited. The German VEZG quotation remains unchanged this week at €1,20 per kilo of slaughtered weight.