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The ruthless heatwave that has afflicted the Iberian Peninsula for the most of July has affected the growth of pigs abruptly. The temperature did not even lower during the night, and the pigs have not eaten enough. As expected, the average carcass weight has dropped: in early July the average carcass weight was 82.34 kg/pig, and by the end of July it was 79.99 kg/pig: more than two kilos have been lost. Heat, heat and more heat, and still going on.
In other circumstances, the drop in the weights would have favoured an increase in price: this has not happened because the Spanish price is already the highest in Europe, and pork price is very low there. The abattoirs' operating accounts show severe losses, and they have reduced their activity by slaughtering only the pigs that they are offered, adapting their demand to the low supply, whilst hoping for better times.
During July, in France, the attacks to foreign (especially Spanish and German) lorries have worsened, up to the point that the German government has remembered the French government of the obligation of allowing the free circulation of goods (one of the main principles of the EU). The fact is that several acts of vandalism have been recorded, and it has been documented that the police officers have only looked but not intervened.
The market is in a stand-by situation, awaiting for events (and moderate temperatures). The other European markets are in a similar situation (the price in Germany raised, in mid-July, by €0.02/kg, but lost them the following week). In France, two important abattoirs pertaining to the wholesale sector have agreed on paying the pigs that they slaughter (20% of the total in France) at a fixed price, over the market price and out-of-market. We will see for how long this attempts for trying to stem the tide go on.
In August nights are longer, and if temperatures drop a little, the pigs will eat more and will end up fattening. When the weights stop dropping, the supply will recover, and then the price will tend to lower.
An important supply is expected this autumn. To avoid a collapse we will need to export at all costs outside the EU. With the Russian embargo there is the hope that China increases its orders in autumn (the price of pork there has grown by 40% since March and it is still rising).
Difficult times are expected. We will have to manage the day to day events the best that we can.
A quotation by Voltaire: “That who fears poverty is not worthy of being rich.”
Guillem Burset
