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AHDB Pig Market Weekly


18 June 2012

AHDB UK Market Survey - 15 June 2012AHDB UK Market Survey - 15 June 2012

Recent data from the British Cattle Movement Service (BCMS) indicated that the trend towards increased calf registrations, which became apparent in the last quarter of 2011, has continued through the first three months of this year.

AHDB

Increased calf registrations

Recent data from the British Cattle Movement Service (BCMS) indicated that the trend towards increased calf registrations, which became apparent in the last quarter of 2011, has continued through the first three months of this year.


During January to March 2012 calf registrations in Great Britian increased by nine per cent, or 55,000 head, compared with the same period in 2011. The number of registrations over this time was almost 700,000 head, two thirds of which were registered as non-dairy animals.

The overall increase was driven by higher numbers of registrations across all categories of cattle. There was an eight per cent increase in female non-dairy calf registrations, which suggests there may potentially be longer term growth in the beef breeding herd if some heifers are retained. Non-dairy male registration also increased by eight per cent, indicating that we are likely to see an eventual upturn in male cattle slaughterings.

Dairy-bred female registrations were up five per cent on the year and representing a significant turnaround from the early part of last year dairy bred male registrations were 17 per cent up on the year. The firm beef prices and some easing in feed costs may have encouraged producers to retain these animals for finishing.

Cattle market trends



Prices

In week ended 9 June, as the Jubilee holiday disrupted trade to some extent, the overall prime cattle deadweight average price strengthened to 334.2p per kg. Reports suggest that the supply and demand position is still finely balanced and a small increase in demand could result in some further upward pressure on prices. The price of R4L steers and heifers both increased by a penny on the week to average 342.6p and 341.2p per kg respectively. The price of R3 young bulls increased by a similar amount on the week to 328.0p per kg. Following last week’s three pence increase, the average deadweight price of cows strengthened a further two pence on the week to reach a year peak of 269.0p per kg.

In week ended 13 June the average prime cattle price at GB auction markets eased a little over half a penny on the week to average 190.2p per kg. The average price of steers and heifers both declined by almost a penny to 191.4p and 194.6p per kg respectively, while the price of young bulls increased marginally to 183.9p per kg.

Retail price spreads

During May the average farmgate price declined over one per cent compared to the month earlier while the average retail price was little changed. As a result the actual price spread between the producer and the retailer narrowed slightly on the month and producers received, on average 54 per cent of the final retail price during May. With farmgate prices increasing to a greater extent than retail prices during the past 12 months the latest figure is two percentage points more than in May 2011.

Despite the average beef price being little changed on the month some cuts were dearer, with the exception of topside joints and sirloin steak. The largest increase in price was recorded by premium mince, increasing four per cent on the month. Other cuts increased in price by between one and two per cent.

In May 2012, all cuts of beef were more expensive than in the corresponding month a year earlier. Standard and premium mince both increased in price by 16 per cent, while rump steak was 10 per cent dearer on the year.

Sheep market trends



Prices

Reflecting the increased prices at auction markets the deadweight lamb SQQ in week ended 9 June increased seven pence on the week to 407.2p per kg. This uplift was evidently the result of tightened supplies due to the two bank holidays and slaughterings were estimated to be approximately a third lower than in the week earlier.

The liveweight lamb trade in week ended 13 June was relatively firm. The SQQ for the week was up almost a penny on the week earlier at 200.4p per kg. Lamb prices on Thursday 7 and Monday 11 June were still showing an upwards trend, however by the end of the period they eased with the SQQ on Tuesday 12 June down almost four pence on the week and on Wednesday 13 June back almost two pence. Despite this decline they still represent a significant uplift from the position in late May. However, with the post holiday restocking appearing to be coming to an end the seasonal decline in price is expected to reassert itself.

Cull ewe values increased three pounds on the week to average £74.35 per head.

Retail price spreads

The much publicised decline in lamb prices during May resulted in the monthly average farmgate price falling by over three per cent on the month to 436.5p per kg. At the same time average retail prices increased by almost three per cent. This resulted in the price spread widening with the producer on receiving 55 per cent of the final retail price in May compared with over 58 per cent in April.

Compared with May 2011, farmgate prices have declined sharply while retail prices have continued to edge up. On average producers received 69 per cent of the final retail price in May 2011. It should be noted that 2011 was an exceptional year for farmgate lamb prices resulting in a considerably higher proportion of the retail price going to the producer. However the latest figure is still lower than that recorded in the corresponding month in recent years.

In May the majority of lamb cuts recorded an increase in price compared to the month earlier. Lamb legs recorded the largest increase in price, up almost six per cent. Lamb steaks were the only cut to record a decline in price and were back one per cent on the month.

Pig market trends



Prices

Finished pig prices continued their seasonal upward trend in week ended 9 June. The DAPP EU Spec has increased by over a penny since the beginning of May to average 149.45p per kg. This comes despite changeable weather curtailing barbecue demand. Supplies have been plentiful since the turn of the year, with throughputs comfortably above 2011 levels. Carcase weights have also been heavier than in the first few months of last year.

For week ending 16 June the average 30kg weaner price eased back by a few pennies for the sixth consecutive week to average £43.15 per head. This year, high feed costs are again limiting the willingness of finishers to take increased numbers of weaners. The prices of weaners are at their lowest level since early December.

DAPP sample increases

Following discussion by the BPEX board, the sample of the dead weight average pig price has been expanded to cover a broader spectrum of the pig market. The DAPP will now be produced using information from eight processors covering 15 sites. These are H G Blake, Cheale Meats Ltd, Cranswick Country Foods, F A Gill, Tulip Ltd, Vion, G Wood & Sons and Woodhead Bros.

BPEX will be looking to expand the sample of participating abattoirs even further in the coming weeks.

Retail price spreads

The average farmgate pig price in May was 149.0p per kg, two per cent higher than in the month previous. Over the month, the average retail price only increased marginally. As a result, the gap between producer and retail prices decreased slightly to 60.5 per cent. This means that producers received an average of 39.5 per cent of the retail price which is marginally more than in April but one percentage point less than at the same point last year.

Although the average price of pork was little changed on the month there were some price movements in selected cuts. The largest price increase was for pork fillet, which increased three per cent on the month. Boneless shoulder joints and loin steaks were both two per cent dearer than they were in April. In contrast, diced pork was noticeably cheaper, with the average price more than two per cent lower than in the month previous. Compared with prices in May 2011 loin chops were less expensive, prices declined four per cent on the year. Prices for most other cuts were higher than a year earlier with the largest rises for minced pork, boneless shoulder joints and pork fillet increasing to the greatest extent.

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