Pig prices are starting to see an upturn thanks to a number of factors including a favourable exchange rate and strong demand from China.
Agriculture and Horticulture Development Board (AHDB) and Quality Meat Scotland (QMS) said the opening week of May was the fifth consecutive week, and seventh week in nine, to see an increase in the GB Standard Pig Price (SPP).
These increases mean the SPP has risen by more than 2.6p/kg from its low point in the week ending March 19 to reach 114.7p/kg deadweight in the week ending May 7.
It comes after a prolonged period of declining farmgate prices.
AHDB Pigs market specialist manager Stephen Howarth said while the upturn was not dramatic, it was positive and would bring some hope to producers.
“We are still a long way from recovery but the signs are there and we would expect to see prices going up in the next few weeks,” said Mr Howarth.
“There is a seasonal factor at play, with a reduction in pigs at this time of year but the exchange rate has helped across all sectors.
“Last year was particularly difficult due to the strength of the pound but we now see a narrowing gap between the domestic price and prices across the continent. This means there is less of an incentive for retailers to source pork imports.
“Strong demand from China means our exports are booming, so that is helping to improve prices.”
QMS senior economics analyst Iain Macdonald said while the number of pigs being supplied to abattoirs had fallen back since Easter, lighter carcase weights had also been reported.
“In the SPP sample, the average carcase weighed 82.8kg during the first week of May, down from 83.7kg in the week ending March 19,” he said.
“As a consequence of lighter carcase weights, the volume of pigmeat produced will have tightened more significantly than slaughter numbers, placing additional upwards pressure on the market.”
The result of lower carcase weights has meant that while per kilo farmgate prices have risen by 2.3 per cent between mid-March and early May, the price of the average carcase rose more slowly, up 1.2 per cent to £94.94.
“The flip side of this is that higher carcase weights than last year mean the average carcase price is down by 12 per cent year-on-year compared with the 13 per cent decline in per kilo prices,” added Mr Macdonald.
“However, in the same period last year, there was a similar tightening of weekly pigmeat supplies yet the SPP was still edging lower.
"The difference this year is that reports from the demand side have been better.”