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AHDB Pork Quarterly Category Report

12 December 2012

BPEX Quarterly Category Report - Review to October 2012 BPEX Quarterly Category Report - Review to October 2012

BPEX Quarterly Category Report

DAPP to EU Specification

(DAPP = Deadweight Average Pig Price)
  • Following an unusually long period of stability between May and August, GB pig prices began to move upwards against the normal seasonal trend. This was in response to high EU prices caused by supply shortages during August and September. By October, the DAPP had reached a new record level, with the monthly average hitting 157.74p per kg, nearly 5p up on the September average and more than 12p higher than last October. Despite some easing of EU prices, the GB price was still on an upward trend in early November
  • Despite higher pig prices, pig producers are still in a loss-making position according to AHDB/BPEX estimates of the full cost of production. Feed prices remain high as a result of poor harvests in several global regions, notably the US. Although soya prices have eased a little on encouraging news from South America, feed wheat prices remain at record levels. The latest provisional estimate for the cost of production in October was over 167p per kg, meaning an average loss of around £7 per pig, although this is only around half the losses being recorded over the summer

Fresh Meat 52 Weeks to 28 October 2012

Source: KANTAR Worldpanel
  • Pork and Beef have both recorded volume declines compared to last year. Lamb has seen volume growth over the 52-week period
  • Chicken has recorded strong volume and value growth over the past year.
  • The average EU pig reference price began to rise sharply at the start of August, about a month before the GB price, in response to a marked tightening of supplies. By late August, the EU average had passed the UK reference price and remained above it for seven weeks, an unusually long period. The monthly average for September was over €190 per 100kg, a level only previously seen during the 2001 FMD outbreak. The EU price dropped back below the UK in mid-October and by early November had fallen below €183, although this was still €25 higher than a year earlier.

Category Inflation/Deflation

% change over 12 months

Annual Change in Retail Meat Prices and Food Prices and the All Items Retail Price Index – October 2012

  • In October, the food retail prices index rose by 3.1% compared to the previous year, in September it was just 1.9%
  • Retail lamb prices in October fell marginally over the 12-month period and were 2.3% up on the previous month
  • Retail prices for pork were 4.4% higher over the 12-month period but 1.0% down on the previous month
  • Beef prices were 10.0% higher over the 12-month period and 0.6% higher on the previous month.

Retailer Overview

  • The top 4 multiples account for 69.9% value share for fresh pork – down from 71.4% compared to last year
  • The hard discounters continue to gain value share across pork products. In particular, their value share of fresh pork increased from 4.6% to 6.1%
  • The top 4 multiples account for 66.9% of sausage sales and 74.5% of ham sales.

52 Weeks W/E 28 October 2012 (FRESH)

Source: KANTAR Worldpanel
  • Two of the top four multiples overtrade in fresh pork
  • The leading retailer under-trades in bacon and pork
  • Discounters continue to overtrade in bacon and pork, but are under-trading in sausages and ham
  • Ham overtrades within all of the top four multiples.

Top four multiples = Tesco, Sainsbury’s, Asda and Morrisons

December 2012

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