February 25, 2014

Scottish pig producers see positive outlook in 2014

Despite the typical New Year dip in prices post the festive season, finished pig prices remain 5-6% up on-year, according to the latest analysis from Quality Meat Scotland (QMS).

Pig prices have fallen from £1.69 (US$2.82) per kilogramme deadweight at the start of the year to £1.645 (US$2.74) per kilogramme in the second week of February. However, according to Iain Macdonald, QMS Economics Analyst, this year it is likely there have been more than seasonal demand factors at play.

With Scottish abattoirs still well supplied with cattle given current orders, prime cattle prices slipped back for a 12th consecutive week. This left steers and heifers at 50-week lows and just over 2% ahead of their mid-February 2013 levels. Meanwhile, young bull prices have fallen by nearly £0.30 (US$0.50) per kilogramme in just three weeks and with numbers at their lowest since New Year, it implies a considerable weakening in demand. Young bulls were valued 3.5% lower on-year and were at their lowest since the final week of March 2012.

In the auction ring, the prime cattle average increased by £0.04 (US$0.07) to £2.085 (US$3.50) per kilogramme as numbers fell back to their lowest level since the opening week of the year. The average price was at its highest level for a month and marginally surpassed its year earlier level following three weeks below it. 

Deadweight cow prices steadied on the week at just under £2.34 (US$3.90) per kilogramme as supplies fell back to their lowest level since the festive season. However, the annual discount widened for a second week and reached 16% as the market had risen in February 2013. On a brighter note for producers selling cull cows, auction prices rose for a fourth week and, at £1.19 (US$1.98) per kilogramme, reached their highest point since late September. Nevertheless, they still fell 11.5% short of the same week last year despite fewer sales.

At Scottish auctions the market cooled slightly on the week as there were increased marketings. The average selling price was £0.32 (US$0.53) per kilogramme (19%) higher than in the same week last year. Cull ewes also edged lower on the week but were £10 (US$16.70) a head more expensive on the year, an increase of 22%.