December 31, 2003
UK Pig Prices To Fall Further
Average pig prices in Britain may continue to fall below the 100p/kg threshold in 2004.
Both the UK deadweight average pig price (DAPP) and the adjusted euro-spec average (AESA) prices reported by the Meat and Livestock Commission were a few pence over 100p/kg before the close of business in 2003.
But, historically, UK prices have tracked, albeit at a premium, EU values.
And those values have taken a downturn, falling 16% over the past three months due to the stronger Euro, which has made exports more expensive.
The EU supply and demand balance has been further exacerbated by temporary interruption of important export markets, namely Japan and Russia.
In response, EU pigmeat market managers in Brussels recently introduced a new 30m (£21m) private storage aid scheme to help assist market stability.
That could take up to 80,000t of mainly Danish pigmeat off the market, but it is hard to know how solid a base this scheme will put in the market.
UK production is expected to rise in 2004 from historic lows, albeit marginally.
The British Pig Executive's provisional UK production forecast for 2004 suggests a slightly reduced sow herd of 500,000.