Pig producers lost an average of about £5 a pig during December, equivalent to a weekly loss of about £800,000 for the industry as a whole.

According to provisional estimates by BPEX, costs of production averaged just over 167p/kg in December, 5p more than in November due to higher feed prices – and 20p more than in December 2011. “This means that costs are back close to their level over the summer, when they peaked at 170p/kg in August,” said the report.

Although pig prices had reached record highs, the increased costs meant that producers were making heavy losses, it added. “Cumulative losses for 2012 are estimated at just under £60m. Forward feed quotes suggest that production costs are likely to remain at or above their current level until next summer, at least. This means that pig prices will need to rise further for the industry to return to profitability.”

Producers across the EU averaged a loss of 15p/kg in 2011, with no country having production costs below the EU average reference price, said the report. “The average cost of production in the EU was 148p/kg deadweight, 12% higher than in 2010.”

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