Low pork prices felt throughout the EU

A number of external factors, such as Covid-19 and reduced demand from China has caused pig prices across the EU to slump with no immediate indications of when they will get better. Cases of African Swine Fever (ASF) in several export-oriented European countries, including Belgium and Germany, have also had a major detrimental effect on exports.

Pig meat production will increase

Overall, according to the European Commission, pig meat production will increase by around 1.7% in 2021 and by less than half that in 2022. Pig numbers have been relatively stable over the past few years so it is anticipated that rising productivity and higher carcase weights will drive that growth.

Looking closely at prices around the EU, there does not seem to be any significant price rises in any of the member states over the past week.

Pig prices in Ireland

The average price paid for grade E pigs in Ireland for the week ending October 17, 2021 dropped to € 1.47/kg. Irish prices currently sit 17c/kg above the EU Grade E price, which sits around € 1.30/kg.

Irish prices have dropped an average of € 0.16/kg since 2020, but have remained stable since the start of this year. Irish prices have dropped an average of € 0.15/kg since 2020 (-9.0%), but have remained stable since the start of this year.

The pig industry has faced some difficulties in recent times with regards to increased labour and feed prices. Composite feed prices are € 0.39/tonne than this time last year.

Highest pig prices in Sweden

Moving across Europe from west to east prices for the same grade E fluctuate somewhat, but are the highest in Sweden at € 2.02/kg. Incidentally, for comparison, prices in the UK remain firm at € 1.76/kg. Grade E prices for the same period in other EU countries include: Belgium € 1.09/kg; Czech Republic € 1.32/kg; Germany € 1.28/kg; Portugal € 1.37/kg and Finland € 1.60/kg. The lowest price quoted was in both Latvia and Lithuania at € 1.08/kg.

The latest weaner prices also show a big fluctuation from the EU average of € 29.54/head. The average price in Belgium was € 18.50/head; Germany € 22.20/head; Croatia € 43.12/head; Italy € 55.37/head and Sweden € 83.74/head. Around 20 EU countries have called on the European Commission to initiate a support structure for the pig sector. EU agriculture commissioner Janusz Wojciechowski has called the pig sector situation “very difficult” and has met with agriculture ministers to address the problem.

Cooling pig export markets

The UK Agriculture and Horticulture Development Board (AHDB) reported that exports in 2021 are forecast to be 6% higher than in 2020, reflecting strong demand from Asia, though the key Chinese market has cooled in recent months. Another 7% rise in shipments is expected next year.

Ongoing low prices may be needed to draw out this export demand, though it is possible there may be some recovery in Chinese import requirements in the coming months. The USDA attaché to Beijing has forecast a rise in Chinese pork import demand in 2022. This comes on the back of lower production due to some destocking this year following disease challenges and falling profitability.

AHDB also said pig meat consumption in the EU is expected to increase (+0.6%) this year as exports are unable to keep pace with rising production. However, a 1.2% decline is forecast next year as production growth slows while export growth continues.