February 1, 2012

EU pig prices rise on shortages

Pig prices in the EU continued to rise over the week as demand outpaced low availability of slaughter pigs.

In France, the producers were able to push through a price which rose US$0.06 from last week's as a result of scarce supply. 

The prices in Germany, the Netherlands and Austria developed in a synchronous way, just as they had over the past weeks. There, the prices went up by US$0.05. In Spain, a US$0.03 price increase could be realised. Germany now has seized the top position within the European price structure, closely followed by Belgium and the Netherlands.

The price level currently prevailing is a quite unusual one to be documented in the month of January. Such prices were lastly quoted in 2001, when the market was strongly characterised by the BSE crisis. The shrinking supply in Europe was attributed to the bad economic situation the piglet producers had to cope with over the past two years.

The decisive impetus given to the market is based on booming exports to non-EU countries and to Russia and the Asian countries in particular. From the producers' point of view the price level prevailing currently is a very welcome one. Yet, the producers find it long overdue for covering the considerably increased costs in pig production.

The atmosphere proves to be friendly on the German market. Even at the new prices, the pigs mature for slaughter are well in demand. In view of the scarce market supply, prices should maintain upward momentum in the coming period. On top of that, this week's icy temperatures will most probably lead to lower supply. Therefore, pig prices in Germany are expected to remain steady at least.