News Pigs

Sow price unexpectedly drops significantly

June 11, 2024 - Wouter Baan

The sales of pork are running much less smoothly in the first half of June than expected, but can still rely on a solid foundation. This does not apply to the slaughter sow price, which unexpectedly takes a significant hit this week. The German Tönnies takes the initiative here.

The major German meat company is lowering the sow price from this Thursday by a whopping 20 cents to €1.20 per kilo, the lowest level since early 2023. Normally, the sow price is only announced on Wednesday, but Tönnies is deviating from that now. There is every reason to do so, as Tönnies will no longer slaughter sows from Thursday this week.

In a statement, Tönnies justifies its decision by indicating that the German retail sector has switched to pork produced according to the standards of Initiative Tierwohl (ITW). As a result, the demand for sow meat continues to collapse, causing the cold stores to be packed to the brim. It is likely that the financing of stocks has become quite expensive due to higher interest rates in the background.

Tone set
It is expected that other sow prices will also implode this week. With the initiative of market leader Tönnies, the tone has certainly been set. Meanwhile, pork prices are moving sideways and the expectation is that they will remain so this week at least. Due to the cool weather in Northwestern Europe, meat sales are lackluster, despite the imminent start of the European Football Championship. This is also evident from the carcass part prices of DCA Market Intelligence which remain almost stable this week. Only the shoulders are under some pressure.

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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