Analysis Pigs
Beneath the surface, the pig market is improving
While hog prices continue to stoically move sideways, the meat market appears to be improving below the surface. The fact that the corona measures are now being relaxed in many European countries is a helping hand.
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After a turbulent January, market developments are much calmer in February. Pig prices in Europe are already in the basement, so it can't get much lower than this. In the short term, the current stable market sentiment appears to continue. As has often been indicated, the ample meat supplies are a negative shock absorber that blunts market impulses. Yet there is more reason for optimism.
Relaxations are a boost
This is primarily due to the meat sales options. The demand for meat parts is slowly improving, slaughterhouses indicate. This is partly related to the 'end' of the corona measures in many countries, which makes it likely that sales opportunities for pork in the food service will improve. And that is something that the market can use.
The supply of live pigs also appears to be becoming slightly less extensive. There are signals from Germany in particular that the pig supply appears to be shrinking somewhat. This corresponds with the significant decline in the German pig herd that became known at the end of last year. The fact that this is already noticeable is in a certain sense striking. In recent weeks, due to the many Omikron infections, there has been a sharp decline in sex. Also in recent weeks, fewer than 800.000 pigs were slaughtered in Germany. This means that a fifth of the slaughter capacity is not being used. In the Netherlands, the pig supply remains consistently ample.
Less gloomy mood
In summary, it can be said that the pig market feels less gloomy. It is true that one swallow does not make a summer. The market needs time to get into better shape. If prices want to climb out of the cellar, the spring revival should of course not take too long. However, an increase is not yet within reach. However, quotations for the German VEZG listing were higher this week, although the price remained at €1,20 per kilo. The DCA Exchange Price 2.0 also remains: the quotation for slaughtered pigs at €1,18 per kilo and the price of live pigs at €0,89 per kilo.
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