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Wide EU Producer Pork Price Differences

03 January 2014

UK - A gap in pig meat prices between the UK and the rest of the EU has been highlighted by the British National Pig Association, despite a generally optimistic outlook for UK pork production in the first part of this year.

More green lights are forecast ahead for the 'Traffic Lights' report, which has reached its 13th birthday. There will be a few amber lights in the opening weeks of the New Year and possibly even a red light or two.

But as the industry's popular 'Traffic Lights' price reporting service enters its thirteenth year, it does so in celebratory mood because the omens remain good for the first six months of 2014, probably for longer.

The promising signs for the New Year follow an outstanding 2013 when there were more green lights than ever before in 'Traffic Lights' history.

The 'Traffic Lights' base price reaching a record 178p for three consecutive weeks — with some producers getting 6p or so on top of that.

The gap between European prices and British prices is a cause for concern, however. The UK pig meat reference price is currently a remarkable 38p a kilo higher than the Dutch reference price.

But despite the weakness of continental prices, two key fundamentals cannot be ignored.

Firstly, the European Union female breeding herd has shrunk by five per cent over the past 24 months (June 2011 to  June 2013) and is probably still falling.

And secondly, British retailers are still committed to sourcing British pig meat, as shown by the most recent 'Porkwatch' results. Shoppers have made it clear that, following the 'horse meat scandal' a year ago, they expect to see the Union Flag on the meat they buy.

Trafficlights Peter Crichton

TheMeatSite News Desk

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