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The Spanish market has turned on the turbo

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All points towards the rise in prices keeping a good pace in the first forthnight of June.

In the four sessions of May, the Mercolleida market has risen the price of the Spanish pig by €0.16kg. In eight weeks we have gone from €0.95/kg to €1.143/kg: more than €0.19 and a rise by more than 20%. This sudden and important increase allows the production sector not to suffer more losses after many months.

Pig price at the Mercolleida market

This sudden change of scenario has caught everybody by surprise. Abattoirs, farmers, experts, consultants... nobody expected such a sudden change of scenario one month ago. The situation is very consistent, because all the European markets without exception are rising quickly.

What is happening can be explained through different factors that have happened at the same time:

  • As we know, Spain exports approximately 50% of the pork it produces. This high relationship with the foreign market makes us more sensitive to what happens overseas. All Europe rises following Germany's trail.
  • The EU is exporting, as a whole, to third countries at an extraordinary pace. Japan and China have increased their imports markedly (+50% overall). This high and sustained exporting pace has had an impact on the European meat stocks, reducing them considerably.
  • The good spring weather has increased the consumption in central Europe. The apathy has disappeared and the fluidity is now the norm.
  • Since January, the slaughterings show record figures (with the exception of Easter). This high slaughtering pace has more than absorbed the abundant supply. Since January, the average weight of the carcasses has dropped by 3 kg, and it has reached the figures of 2015. There have been many pigs, but all of them have been slaughtered.
  • Last summer's excessively high temperatures caused many returns-to-oestrus, and we miss those pigs now.
  • In Christmas there was no space available for the piglets in the fattening sites, no piglets were entered, or they were slaughtered. These pigs are neither present now.

All points towards the rise in prices keeping a good pace in the first forthnight of June. The supply is moderate, and the demand seems, up to now, quite firm. June will behave well, and September (always with a downward trend) is still far away.

We have climbed out of the hole after many months. It has been very difficult, but we have made it. Six months that have been like hell have ended.

Theodore Roosevelt, the 26th president of the US, said: “Do what you can, with what you have, where you are.”

Guillem Burset

Guillem Burset

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06-Jul-2016 chriskim0606very nice
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