K&H: price correction in the pig industry: financial stability comes to the fore at the beginning of the year

“The pig market has experienced an extremely rapid price adjustment. We have experienced a 25-30 percent decrease in the space of a few months, while there has been no similar reduction in costs”

– commented Zoltán Demeter, Head of K&H’s Agricultural Business.

“The current situation has developed from the combined effect of several factors. The favorable market environment of recent years has brought about an expansion of production in the European Union, while domestic demand has not been able to fully follow this. In addition, Spanish pork stocks have been stuck due to African swine fever, and Sino-European trade tensions have also strengthened the supply side. In this situation, preserving liquidity and rethinking financial planning became a priority for economies. Although this year could also be a year of investments due to subsidies, many have become more cautious in the current situation. In terms of developments, gradualism and those investment elements that directly improve efficiency may come to the fore. According to market expectations, price stabilization may start from the second quarter at the earliest, which may create a more favorable environment for continuing developments”

– the expert added.