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AHDB Pork Quarterly Category Report

03 March 2014

BPEX Quarterly Category Report - Review to January 2014BPEX Quarterly Category Report - Review to January 2014

BPEX Quarterly Category Report

  • GB pig prices were firm but broadly stable during the final quarter of 2013, albeit at near record levels. Ongoing strong retailer demand for British pigs and positive export markets have been met by relatively tight supplies. Prices remained well above year earlier levels but the gap narrowed somewhat as there was no repeat of last year's rising prices

  • The cost of pig production has remained well below the pig price since June. This has allowed producers to pay back some of the losses incurred over recent years. However, the current pig price is still lower than the peak level of costs last January, so producers are still vulnerable to any future shocks in feed market
  • Pork has seen reduced volume purchases over the past year, led by the fall in leg and shoulder joints but with frying/grilling chops also down. Lamb has been the only meat to show sales growth in volume purchases, with most of the growth coming from leg roasting joints (+18.9%)

  • Despite the fall in volume sales, overall expenditure has increased for all meats. The 2.0% increase in expenditure on pork has been dominated by sales for pork chops/steaks, loin joints and mince, which have compensated for the loss in sales for leg roasting joints (-8.6%).

  • EU pig prices have fallen back sharply from their peak in early September, losing over €30 per 100kg (15%) by the end of the year. A combination of higher than expected supplies (albeit still relatively tight) and subdued demand (despite robust export markets) is to blame. As a result, the gap between EU and UK prices was the largest in nearly a decade around the turn of the year.

Category Inflation / Deflation

Annual Change in Retail Meat Prices and the All Items Retail Price Index - December 2013

  • In December, the food retail price index rose by 2.0% compared to the previous year and by 0.2% compared to the previous month
  • Retail lamb prices in December fell over the 12-month period by 0.5% and by 3.5% on the previous month
  • Domestic lamb prices rose by 4.0% during December while impor ted lamb prices rose by 2.9% during the same period. Over the 12-month period domestic lamb has risen by 8.1% w hile impor ted lamb has fallen by 6.9%
  • Retail prices for pork were 1.2% lower over the 12-month period but where 0.7% up on the previous month. Retail bacon prices were 3.9% higher over the 12-month period and up 1.0% on prices in November
  • Beef prices were 6.4% higher over the 12-month period and 0.5% lower than the price in November
  • Retail prices for poultry were 2.4% higher over the 12-month period and down 0.8% on the previous months price.

Retailer Overview

  • Two of the top four retailers have seen above market growth for fresh pork, while the other two recorded falls in expenditure compared to last year. The top four account for 68.9% value share for fresh pork; down from 70.2% compared to last year

  • The top four retailers have seen falling value share for all meats, down to 67.6% of total market expenditure from 68.9% last year

  • The hard discounters continue to grow in market share, accounting for 6.6% of meat expenditure; up from 5.3% last year. The hard discounters have recorded increased shares across all pig meat categories

  • Sausage sales grew by 8.7%, with the top four multiples accounting for 66.1% of sales. None of the top four retailers, however, grew ahead of the market. The hard discounters, with 3.9% of market share for sausages, recorded growth in sales of 22.7%
  • The hard discounters significantly overtrade in pork and bacon
  • All of the top four multiples overtrade in ham
  • Three of the top four multiples undertrade in sausages.

* MAT = Moving Annual Total. ** RST = Retailer Share Track.
A consolidation of data for all key commodity products, 237 markets in total.
Markets fall into five key trading sectors: Packaged Groceries, Fresh Foods, Toiletries, Healthcare, Alcohol.

March 2014

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