June 16, 2011

UK pig prices continue to increase

UK pig prices continue to rise and are currently more than year-ago levels, but stay lower than the cost of production.

In the week to June 11, the EU deadweight average (DAPP) increased by GBX0.6/kg (US$0.01), to GBX151.4-4.6/kg (US$2.46-0.07) above the same week last year.

"Tight supplies throughout May are reported to have contributed to the rise in the DAPP during the month," said a report by AHDB Meat Services. "The monthly average, at GBX148.76/kg (US$2.42), was almost 5% higher than the average price in April and 2% higher than in the corresponding month a year ago."

However, despite these price rises, farmers are still receiving well below production costs. "Estimates for June place the cost of production at GBX162/kg (US$2.63). If prices were to remain at current levels producers will lose over GBP10 (US$16) per pig next month."

Farmgate prices increased by more than retail values between April and May, meaning producers received almost 41% of the final retail price, a rise of one percentage point over the month. Retail prices for boneless leg and minced pork both increased by 3% on the month, with fillet end leg up by 2%, but loin chops down by 2%.