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Analysis Pigs & Pork

Hodgepodge on pig market, processors expand margin

April 25, 2024 - Wouter Baan

Uniformity is far from sight on the Dutch pig market this week, as many slaughterhouses are lowering their prices to a greater or lesser extent. This is in contrast to Germany, where pig prices have remained unchanged for yet another week.

After a period of stability, many market insiders were under the impression that pig prices could move up, but nothing could be further from the truth. Vion unexpectedly shook up the market on Monday by postponing the publication of pig prices. This was attributed to the uncertainty in the market. Subsequently, Compaxo took the initiative yesterday with a reduction of 4 cents. Pali and Westfort are more moderate, both implementing a 2-cent reduction.

Vion decides to keep the pig price unchanged, but does reduce the weekly surcharge by 3 cents. This surcharge had been increased by this amount three weeks ago to offset the previous reduction in pig prices. Of the major slaughterhouses in our country, only Van Rooi maintains its listing unchanged, showing the best side to its suppliers.

German market unchanged
It is noteworthy that the price pressure from Germany that was expected in our country has not materialized, as the (slaughterhouse) prices remain 'normal' this week. This means that the price difference between Dutch slaughterhouses and the German market has further widened, in favor of the Germans. However, it is not immediately likely that more Dutch pigs will cross the border in the coming weeks, as in Germany, three slaughter days in May are canceled due to Labor Day, Ascension Day, and Pentecost. In the Netherlands, the reduction in slaughter days is limited to Christian holidays only.

Margin recovery
Based on the meat mutations from DCA earlier this week, the reductions in the Dutch pig market are quite substantial. Only the hams decreased by 4 cents, while loins and bellies became slightly more expensive. Based on these mutations, the calculated carcass price decreased by €0.0075. The conclusion is that the slaughterhouses that have lowered their purchase prices have done so to expand their margins.

Wouter Baan

Wouter Baan is the editor-in-chief of Farmerbusiness and a market specialist in dairy, pork, and meat at DCA Market Intelligence. He also tracks developments within the agribusiness sector and conducts interviews with CEOs and policymakers.
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