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AHDB Pig Market Weekly


27 July 2012

AHDB UK Market Survey - 13 July 2012AHDB UK Market Survey - 13 July 2012

After more than 40 years in publication the design of the UK Market Survey is changing. Launched in 1968, under the auspices of the Meat and Livestock Commission (MLC), it was intended to give readers a better knowledge and understanding of UK red meat industry.

AHDB

Changes to the UK Market Survey

Building on this, a new portfolio of publications will continue deliver market information and analysis to the livestock industry.


Back in 1968, as with the modern day publication, cattle, sheep and pig slaughterings and the volume of meat produced was featured. In 1968, 2.8 million steers and heifers were slaughtered one million more than in 2011. Pig slaughterings totalled 12.9 million head, three million more than in 2011 while in contrast, sheep slaughtering at 12.3 million head were over two million less than in 2011.

Price reporting in 1968 featured wholesale prices from The London Central Meat Markets alongside fatstock prices from auction markets, which included the Fatstock Guarantee Payment, introduced in 1954, following the end of post-war food controls. As is the case today, store cattle, sheep and pig prices were also published. Other features included commentary around feed prices and livestock census results. In addition, the MLC was already publishing analysis of the costs of production, which goes to highlight the importance of the costing work that continues on farm for all species today.

From next week, the UK Market Survey and its sister publication the European Market Survey will be replaced by two new publications, Cattle and Sheep Weekly and Pig Market Weekly. Following feedback from levy payers, these publications will be shorter and more accessible. The monthly Pig Market Trends will continue and there will be a new monthly Cattle and Sheep Market Update.

Cattle and Sheep Weekly will be a two-page publication, with one page each for the Cattle and Sheep markets, and will be published every Friday. It will provide key market indicators, a commentary on prices and short articles on other topical market issues or data releases, including slaughterings, trade, consumption and census data. More in depth analysis of these and other market issues, including full coverage of international markets, will be provided in the monthly Cattle and Sheep Market Update, the first edition of which will be published at the end of this month.

Pig Market Weekly will be an e-mail newsletter, published on Thursday mornings. It will provide key market indicators along with articles on topical market issues, covering the UK, EU and global markets. Pig Market Trends will continue to provide more detailed analysis of the market on a monthly basis.

Both of the new weekly publications will be available free of charge and all existing subscribers will automatically receive them both unless they inform us beforehand. The monthly publications will also be available free of charge to e-mail subscribers and previous subscribers to Cattle Market Outlook or Sheep Market Outlook will automatically receive Cattle & Sheep Market Update. If you no longer want to receive one or more of the publications or want to subscribe to additional ones, please contact Emma Whitlock (emma.whitlock@ahdb.org.uk).

Most of the data currently published in the two existing weekly publications is now available free of charge through the BPEX and EBLEX websites:

http://www.bpex.org/prices-facts-figures/
http://www.eblex.org.uk/markets/eu-statistics.aspx
http://www.eblex.org.uk/markets/uk-statistics.aspx

Cattle market trends



Prices

As the poor weather prevailed and the eagerly anticipated barbeque season failed to arrive deadweight cattle prices continued to strengthen in week ending 7 July. The overall prime cattle average price increased over a penny on the week to 341.9p per kg. The price of R4L steers increased two pence, breaking the 350p per kg barrier for the first time, at 351.2p per kg. The price of R4L heifers levelled on the week at 348.1p per kg while R3 young bulls were just short of a half a penny dearer at 334.9p per kg. With the exception of a handful of weeks throughout May, and as a result of the continued tight supply, deadweight cattle prices have increased steadily since the turn of the year. The latest overall average is three per cent higher than in early January and 38 pence per kilogram up on the average price in the corresponding week last year.

In contrast, and despite lower supplies, in week ended 11 June the prime cattle average price at GB auction markets eased over two pence on the week at 189.4p per kg. The average steer price fell two pence to 190.7p per kg while heifers were four pence cheaper at 193.2p per kg.

Retail price spreads

The average farmgate price in June was 338.0p per kg, one per cent higher than in the previous month. The average retail price also increased on the month, albeit to a slightly greater extent, the gap between the producer price and the retail price widened marginally compared to the month earlier to 47 per cent. Consequently, the producer received on average 53 per cent of the retail price which is slightly less than in the month earlier but one percentage point lower than in the same month last year.

The average price of selected beef cuts showed similar trends, with the price of standard mince up three per cent while topside joints, diced stewing steak and premium mince prices increased by two per cent. The price of sirloin, rump and fillet steak all increased marginally compared to the month earlier.

In June all cuts of beef were dearer than in the corresponding month a year earlier. The price of standard and premium mince increased to the greatest extent, up 16 and 13 per cent respectively. Rump steak was 10 per cent dearer on the year while the average retail price of topside joints and braising steak was eight per cent higher than in June 2011.

Sheep market trends



Prices

In week ended 7 July deadweight lamb prices eased for the second consecutive week. At 406.7p per kg the latest GB deadweight SQQ fell over 22 pence on the week. This decline means that the SQQ falls below that in the corresponding week last year but still represents a significant uplift on prices in 2010.

As supplies appeared to tighten, the liveweight trade at GB auction markets strengthened in week ended 11 July. At 190.0p per kg the latest GB SQQ was up almost eight pence of the week.

Although the trade is starting to talk up cull ewe values in anticipation of firmer demand for Ramadan, which falls on or around 20th July. This has yet to translate into any upwards movement in price with the latest cull ewe value levelling on the week at £70 per head.

Retail price spreads

Farmgate lamb prices eased in June. Although some resilience towards the end of the month meant that prices did not come back as much as they have in recent years. The average SQQ for the month was two per cent lower than in the month earlier at 425.6p per kg. The decline in procurement costs has evidently allowed retail prices to ease somewhat and the average retail price also declined two per cent compared with the month earlier. These comparable movements resulted in the share of the final retail price producers received in June changing very little compared to May at 55 per cent.

The overall fall in retail prices was largely driven by a considerable decline in the price of whole legs and fillet end legs, down seven and four per cent respectively. Competition from New Zealand supplies and stronger promotional activity were the main causes behind this. The average recorded price of New Zealand fillet end legs fell 22 per cent between May and June. The retail price of most other cuts of lamb were broadly stable on the month. The price of loin chops, bone-in shoulder joints and diced lamb recorded increases of around one per cent on the month.

In June most cuts of lamb were cheaper than in the corresponding month a year earlier. The exception to this was shoulder joints, double loin chops and diced lamb.

Pig market trends



Prices

Pig prices were little changed in week ended 7 July, with the EU-spec DAPP adding just 0.09p to reach 150.40p per kg, about two pence lower than a year earlier. The supply of clean pigs remains relatively strong, with an estimated slaughter of just under 160,000 during the week. However, the average carcase weight declined a little to take it below its level a year earlier at 77.65kg. Poor weather conditions continue to subdue consumer demand, both at home and on the continent, while further weakening of the euro against the pound is also limiting any price rises.

Cull sow prices have fallen sharply in the last two weeks, with the average price down nearly two pence to 111.54p per kg for week ended 7 July. This was the second consecutive fall of this level and reflects declining prices on the key German market, exacerbated by the unfavourable exchange rate.

With a further rise in feed prices in the last week leading to rising production costs, the prices which finishers have been willing to pay for weaners continued to fall. For week ending 14 July, the average 30kg weaner price was down almost a pound to £41.37 per head. This is nearly five pounds lower than a year ago, when prices were only falling slowly.

Retail price spreads

The average farmgate pig price in June was 149.80p per kg, marginally higher than in the previous month. Over the month the average retail price remained stable which meant that the gap between the producer and retail prices fell back very slightly to 60 per cent and producers received an average of 40 per cent of the retail price.

Average prices for most pork cuts remained relatively stable with few exceptions. The largest price increase recorded on the month was for fillet end leg, which increased by four per cent. In comparison to the previous month, pork fillet and loin steaks were cheaper by one per cent. In relation to prices in June 2011 the price for minced pork increased significantly, by 11 per cent, along with rises of between three and five per cent for boneless leg, boneless shoulder and traditional pork sausages. In contrast the price of loin chops were five per cent cheaper on the year.

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