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Welcome spring, or the light at the end of the tunnel

The worst has already passed. We will have to see where our price can get to.

Tuesday 3 May 2016 (2 years 7 months 10 days ago)

Since December until now, the pattern of behaviour of the price has consisted of shy reactions followed by retreats. It seems that things have changed and that we are decidedly facing a rise. The increase accumulated by the Spanish price in April (€0.035/kg) is not bad at all bearing in mind the vicissitudes suffered by the price since December. Anyhow, we are leaving the first four months of the year with an average price of €0.954/kg LW, which is still heartbreaking.

Spring has arrived like every year together with winds of change. In Spain we are slaughtering at the full capacity of the abattoirs, and we are exporting (to the rest of the EU and to third countries) beating records every month. The average weights of the carcasses are still higher than normal, but they are lowering slowly.

In the rest of the EU, there are also very important slaughterings, and the exports to the Far East (Japan, South Korea and, very especially, China) are behaving very well, with record amounts exported so far this year.

The exportation to third countries is the key. Europe maintains its competitivity in front of the US and Canada thanks to the weakness of the euro against the dollar. For the moment being things are like that. The possibility of Russia authorising European exports is still very remote.

In April we have known that Mexico has authorised the importation of Spanish pork. To this aim, it has approved some Spanish abattoirs and butchering rooms. Mexico is a very interesting destination, because it is a part of the trio of countries that will import more than 1 million tonnes of pork this year. This is a good door that has opened for the Spanish pork.

An important part of the private storage pork stock will be released in May. Its impact on the market is a real mistery, although we think that its final effect will be almost unnoticeable.

May will be faithful to its history, and the Spanish price should be able to gain some more cents. The key lays in being able to keep the extraordinary slaughtering pace, which, in turn, depends on being able to keep the exports at the current high pace. Consumption in Europe (the famous German barbecues) should help.

Surely, the worst has already passed. We will have to see where our price can get to.

The American writer Ralph Waldo Emerson once said: “The years teach much which the days never learn.”

Guillem Burset

Guillem Burset


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Article Comments

This area is not intended to be a place to consult authors about their articles, but rather a place for open discussion among pig333.com users.
04-May-2016Heaven R TorresHeaven R TorresThe same price depression is happening in the Philippines. The local market is over stocked because of imports from abroad. Local producers hope these importations (some of them illegal and untaxed) find other destinations than the Philippines.
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