26 March 1999

Pig producers need to get grip of costs

PIG farmers need to obtain a more detailed understanding of their commercial performance if they are to emerge from the present crisis.

Jamie Gwatkin of consultants Andersons told a British Pig Association seminar at Stowmarket, Suffolk, that the industry had to change to survive. Producers needed to obtain a better appreciation of their production costs in order to make informed decisions.

The benchmarks should include their own cash withdrawals and tax liabilities, as well as the costs of livestock purchases, feed, labour and other overheads. "Even in the present crisis, farmers often dont know their costs of production," said Mr Gwatkin.

Technical performance

They also needed to improve their technical performance and to forge more links with abattoirs and processors. More joint ventures would help stem the massive swings in supply and demand which had led the industry to crisis. "Farmers are getting together on the continent and weve got to do the same here," Mr Gwatkin said.

In the present financial climate, the aim should be to get production costs down to about 90p/kg of pigmeat. (See table)

George Cook, also from Andersons, said farmers struggling to keep their businesses afloat needed to be realistic about their finances and to keep up a dialogue with their bank managers.

If they showed a willingness to face reality and address the relevant issues, they would find a genuine desire to help. "Be proactive with the bank – dont just react when they contact you," he said. &#42