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Farmgate prices remain firm for pig producers

Lower production has supported prices in 2020

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Farmgate prices remain firm for pig producers

Farmgate pig prices have drifted lower through August and September but still remain ahead of 2018 and 2019 prices on the back of lower production.

 

For much of 2020 the volume of pigmeat leaving UK abattoirs has been lower than year earlier levels, however June and July broke this trend with year-on-year increases in production which, in turn, led to farmgate prices softening.

 

“Latest estimates for UK production show volumes have once again dipped below year earlier levels,” said Stuart Ashworth, Director of Economics Services at Quality Meat Scotland (QMS).

 

Supplies

 

“Despite this slight tightening in supplies, UK prices have continued to drift downwards through August and into September.”


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But Scottish farmgate prices were 5 per cent higher than last year and 9 per cent up on 2018 with heavier carcase weights resulting in larger increases in the value of each pig.

 

In contrast prices across Europe are much lower than last year and the five-year average.

Mr Ashworth said some of the UK fall in prices may be influenced by Europe.

 

UK pigmeat producers were keeping a wary eye on the implications of the confirmation of African Swine Fever (ASF) in Germany which could destabilise the European and UK market.

 

One consequence of ASF is that most importers of pig meat immediately suspend all imports from countries with ASF. This has proven to be the case with significant importers of German pigmeat like China, Japan, South Korea all suspending imports from Germany.

 

Germany is hoping that China, in particular, may be persuaded to adopt a regionalisation policy where regions within a country can be considered to be ASF-free and trade can continue and mitigate the impact of the restrictions on exporting to China and elsewhere.

 

Exports

 

“This is the policy adopted internally within the EU and which would allow pigmeat from some parts of Germany to be exported to EU countries,” said Mr Ashworth.

 

“As the UK is still transitioning out of the EU, current EU rules still apply and, consequently, German pigmeat could continue to be available in the UK,” he added.

 

Germany is the largest pigmeat producer in Europe, and the second largest European exporter of pig meat to markets outside the EU.

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