Shrinking supply of pigs puts the game on the wagon

Slaughterhouses are sometimes seen as the bogeyman by primary producers and traders, but this time there is no reason to complain. Van Rooi raised the quotation by €0,04 to €1,58 per kilo out of the blue on Wednesday. Westfort and Pali Groep followed suit. Vion and Compaxo did not do so and have not added weekly surcharges afterwards. However, it is expected that they will still follow the initiated increases with their quotation next week.

Anticipating shrinkage
The increase is not entirely explainable. Meat prices have been so flat in recent weeks that they did not immediately provide room. However, the margins of slaughterhouses apparently allow them to do something extra; that is how we should read the increases. This is probably done to anticipate the upcoming reduction in animal numbers. In that respect, 2025 will be an exciting year for slaughterhouses, with a threat of overcapacity in slaughter hooks. The last thing you want then is for the permanent suppliers to run away.

Increases are also visible in Belgium, although to a limited extent. Danis increased by €0,01 to €1,19 per kilo (live weight). In Germany, there is no movement in the market, with the VEZG quotation stuck at €1,72 on Wednesday. This price level is expected to remain in place until the end of March, according to various sources in the market. Slaughterhouses and the producers' association VEZG are said to have reached a compromise to bring more calm to the market following the outbreak of foot-and-mouth disease a few weeks ago. The future will tell to what extent this agreement will remain in place. The pressure will increase when the surrounding countries continue to increase. However, this is not yet the case. 

Supply is shrinking
The ample supply of pigs in the Netherlands is meanwhile increasingly shrinking. With 308.938 slaughters and an average weight of 102,6 kilos, the supply in week 7 was above average ample and heavy. The oversupply will continue to decrease towards shortages in the coming months. This is in view of the large number of stoppers. The era in which more than 300.000 pigs are slaughtered in the Netherlands every week is coming to an end soon. The position of (meat) pig farmers in the chain is visibly improving, as is also reflected in the pricing of slaughterhouses this week. 

Based on the data, the DCA Stock Market price increases by €0,06 to €1,78 per kilo for slaughtered pigs. The price of live pigs increases by €0,05 to €1,40.  

Click here for an explanation from DCA Market Intelligence on the listing.