Downwards pressure on EU Prices
In the four weeks ending 17 September the EU reference price fell by €3.02 to €167.80/100kg.
The EU reference price began a general downwards movement in week ending 9 July and now stands just €2.34 above the same week last year. The narrowest gap so far this year.
EU pig prices normally level off over the summer holiday period before declining in autumn, as production often picks up in the latter quarter of the year. The decline has begun a little earlier than expected this year and is attributed by some industry reports to a drop in demand and unusually high numbers of pigs coming forwards. Demand for pork exports outside of the EU is also down.
Looking at individual countries, many of the key EU markets have recorded price falls over the past four weeks. Germany recorded a price fall of €4.61, to €170.35/100 kg. Industry reports from Germany suggest that pigs are coming forward in such numbers that abattoirs are working at maximum capacity. The Netherlands and Spain both also recorded falls in price of €3.38 and €3.79 respectively. Denmark recorded a smaller fall of €1.69.
The UK price in euros bucked the trend and was broadly stable over the most recent four week period, reporting a gain of €3.77 in the most recent week to €180.98/100 kg, assisted by the strengthening pound. Compared to the same week last year this is €19.25 higher. When looking at the prices in sterling, the UK price is £11.81 above the EU reference price at £162.20/100 kg. However the UK price recorded a week-on-week fall of £0.08. In sterling, the EU reference price was recorded as £150.39 in the week ended 17 September, a week-on-week fall of £5.25.
With prices across the EU facing pressure this may lead to further price falls over the coming weeks in the UK, especially if demand both domestically and aboard remains weak.
Rebecca Oborne, Analyst
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