Pig producers are still benefiting from firm farmgate prices

Scottish pig producers continue to benefit from firm farmgate prices which are around 10% higher than a year ago, according to the latest market commentary by Quality Meat Scotland (QMS).

Stuart Ashworth, director of economics services with QMS, said the longer-term effects of African swine fever in China are expected to result in continued firm demand from China for pig meat well into 2021.

However, recent indications are that import prices paid may not remain as firm as they are as Chinese producer prices, although about double the levels of a year ago, have fallen more than 20% over the past quarter.

The general firmness in the UK market has been achieved despite slaughter statistics showing a small increase in both the numbers slaughtered over the first third of the year and increased prime pig carcase weights.

“Market firmness has been helped by firm retail demand particularly for bacon and sausages, although the market for pork roasts has been more challenging,” said

Mr Ashworth.

Looking at the major pig meat exporting countries, all have reported considerable growth in exports to China despite the coronavirus outbreak.

“The European Union, for example, reported exports to China in the first quarter of 2020 75% higher than the same period last year,” said Mr Ashworth.

“Similarly, and despite trade tensions between China and the USA, the US reported exports to China in the first quarter of the year nearly five-fold higher than a year earlier.”

Turning to potential trade disruptions due to Brexit negotiations, he pointed out the process of agreeing the terms and conditions of trade take inevitably involve compromise.

He added: “However, that compromise should not result in the high standards of animal welfare and food safety demanded of Scottish producers being compromised by relaxation of nontariff barriers to trade.”