Analysis Pigs
Pig market looking forward to the end of holidays
As long as the summer holidays in Northwest Europe continue, the pig market can expect little impulses. The demand for pork remains far behind the high expectations that were initially there, but have long since gone up in smoke. It is waiting for the moment when schools start again.
Earlier this week, the market was confronted with a sharp price drop of the German pig price (VEZG), but actually hardly anyone was surprised anymore. A significant reduction was foreseeable beforehand. What can still be concluded is that the 10-cent drop was at the top end of the negative predictions range. This once again characterizes the weak sentiment in the market.
Abundant stocks
In short, the meat sales do not match the supply. Full freezers at slaughterhouses and abundant stocks at retailers dampen any form of sentiment. Although the sun is showing itself more often again, this does not lead to extra demand for BBQ meat. Perhaps for consumers, but supermarkets have bought in bulk in the pre-season and still have enough stocks to deliver. The many price promotions on the shelves are a silent witness to this.
Return of holidays
In Germany, the holidays are coming to an end. In Lower Saxony, schools have already started again this week and in North Rhine-Westphalia, it's the end next week. The week after that, schools in the South region of the Netherlands will also start again. This is now the only hope of slaughterhouses for better meat sales when the majority of holidaymakers return and the meat industry is back in full swing.
Many meat buyers are still waiting to hedge volume, now that the market direction is downward. In a market with a short horizon, a lot can still happen later in the third quarter and also in the fourth quarter. Export markets outside Europe require limited volumes. Europe may be somewhat more favorably priced, but is still too expensive compared to suppliers in the United States and Brazil.
Assumption of Mary
Towards next week, the market sentiment is very weak, although major price drops are no longer expected. The demand for pigs and carcass parts is even lower in various countries, as Thursday, August 15 is celebrated as the Assumption of Mary in some countries like Poland and parts of Germany. This costs a processing day. It helps that the supply of pigs itself is not very abundant, so the effect of this is manageable.
DCA Market Price
Given the recent price developments in the Netherlands and Germany, the DCA benchmark still has a step to take downwards. Based on the information provided, the benchmarkt of slaughtered pigs decreases by €0.04 to €2.02 per kilo. The benchemark of live pigs decreases by €0.03 to €1.59 per kilo.
