EU pig prices sizzling as supplies run low
The EU average pig reference price has climbed over the past four weeks, gaining almost €9, to stand at €161.75/100kg in week ending 02 April. The current quote is the highest since October 2016 and over €33/100kg higher than the equivalent week last year.
These developments reflect the tight supply situation currently in play in Europe, following previous reductions in the breeding herd. Upcoming shortages of finished pigs had been suggested for some time by the skyrocketing EU weaner price, which has been rising for 21 consecutive weeks.
Compounding the lower supply levels is a seasonal increase in demand, partly attributed to the upcoming barbeque season. Anecdotal evidence suggests that the strong demand and short supply of pigs has spurred producers to bring pigs forward to slaughter earlier than usual, leading to a reduction in carcase weights. Furthermore, the reported lack of pig meat in cold stores throughout the EU is likely to reinforce demand for live pigs.
Particularly strong price increases were seen in Germany; rising over €12 during the previous four week period to reach €169.14/100kg in week ending 02 April. Over €5 of this growth occurred in the last week alone. Similar increases were recorded in the Polish and Dutch price over the past month, while French and Danish values increased more modestly by around €5.
The UK reference price also increased by over €2 during the previous four week period, reaching €175.79/100kg. Similar to the continent, the UK market has also been affected by tightening supplies. In sterling terms the increase was slightly greater, partly driven by further currency volatility. As such, the premium of the UK price over the EU average has fallen to the lowest level since November 2016.
Bethan Wilkins, Analyst
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