After the bulk prices rose rapidly shortly after the outbreak of the war in Ukraine, the downward trend has been going on for a year now. Over the past 20 months, pelleted pig prices have fallen by about 12%, while cattle feed has become about XNUMX% cheaper. This seems like a lot, but it is relative in the light of grain prices. How much room for additional price reductions is there in the coming months?
In May, the decline in bulk prices again gained some momentum, according to data from Wageningen Economic Research. The price of pork chunks fell by €14,50 to €343,50 per tonne. This means that the price drop will now last exactly one year. Sow feed also became considerably cheaper during that period, as did piglet pellets. Cattle feeds also show a downward trend, but this pace is somewhat more moderate. For example, the price of A-brok fell by €9,50 last month to €345 per tonne.
Margin adjustment
Although the price drops in themselves can be described as significant, feed prices only partly follow the raw material markets. The wheat price on the Matif, which mainly determines the price development of pork chunks, has already fallen by at least 35% since its peak last May. Price developments on the feed markets show that compound feed manufacturers are regaining margins that were lost during the period when war had broken out and grain prices were exploding. This is a common phenomenon in compound feed country.
In addition, chunk prices often react with a delaying effect to developments on the grain markets. The price drop on the feed markets is also somewhat counteracted by the soy prices on the CBoT in Chicago, which have remained at a reasonable level.
Further price drops
There remains plenty of room for further price drops in the feed market in the coming months. The compound feed price indicator of Boerenbusiness predicts a price drop of about 10% until November meat pig chunk, based on the current price level. The prices of a-brok can decrease in the same order of magnitude.