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Relentless Rise of DAPP Sets the Tone

by 5m Editor
20 June 2009, at 5:49pm

UK - Very firm prices (but no fireworks) in all sectors today with DAPP continuing its relentless ascent and now standing at 153.36p compared with 130.85p at the start of the year, writes Peter Crichton.

Although the Tulip 157p base price remained at stand-on levels, contract base prices tied to the DAPP generally rose by circa 0.5p.

Because contract prices are now generally running ahead of spot several of the larger abattoirs had all the pigs they needed without looking for more and as a result spot quotes tended to stay at generally similar levels to last week.

A snapshot of prices paid on Friday saw most in the 153–156p range with the odd penny or two available on tighter specs.

With relatively strong heavy pig prices it is hardly worth selling lightweights unless premiums of 10p/kg and more become available.

In contrast to finished pig prices, cull sow prices have been in steady retreat since the start of the year when they were worth 120p compared with values in the 107–110p range today according to specification.

A quick glance at currency values over the same period helps to explain this trend with the euro worth 96p on 3 January compared with just under 85p today.

Please excuse the mixed metaphor, but weaner prices remain “bullish“ and it is difficult to buy large numbers at the latest AHDB 30kg ex-farm quoted 357.31/head with more buyers than sellers still operating in this sector.

In the feed cereals sector although the wheat price dropped a week ago, the market remains volatile with several producers looking much harder at setting up long term fixed price feed contracts rather than face the threat of any feed price scares in the months ahead.

Although the outlook for pig prices in the medium term remains good, some insurance on the feed front would still be a good idea, especially if a rising sterling drags down the euro adversely affecting the pigmeat market as a whole.