Finishers are estimated to be losing £31-£33 on each slaughter pig this month, according to AHDB Pork data.
The full economic cost of producing a pig at the current average carcass weight of about 88kg is put at £203 a pig, or 231p/kg.
This compares with the June rate of 244p/kg, with slightly lower feed costs contributing to the fall in overall production costs this month.
Since December 2021, feed costs have risen to 71-74% of the full economic cost of production, said Carol Davis, lead analyst: farm economics.
Historically, feed costs have accounted for 60-65% of the cost of producing a kilogram of pigmeat.
Pig prices rise
The latest standard pig price (SPP) and all-pig price (APP) show further improvement, with the SPP for the week ended 16 July rising almost 2p/kg to 193.1p/kg deadweight and the APP at 195.5p/kg, up 0.9p (week ended 9 July)
The government has launched a review of the UK pig sector, with the intention of improving fairness and transparency within the supply chain.
Commenting on the launch, pig consultant Peter Crichton said: “Very little has been seen in the way of actual financial support for the pig industry, and there is still some confusion over the extent to which UK pig producers have (or have not) benefited from various “top-up” payments from some retailers.
“In many cases, on a per-pig basis, these work out at very low levels of contribution.”
EU pigmeat prices have seen a rapid recovery since April to stand 17% above the April-May 2017-21 average, reports the EU Commission in its latest short -5erm outlook.
Growing environmental concerns, reduced export prospects, sustained high input costs and African swine fever have pushed production down.
Pigmeat production in the EU is set to fall 4.7% this year, with particularly large reductions in Germany and Poland.
EU domestic consumption is also forecast to drop by 3.3% to an average of 31.7kg per capita.
China will be the main export destination for EU exports, but its growing pigmeat production capacity means EU shipments to that destination are expected to fall by 40% this year, to just above 2016 levels.
After China, the UK is the second-largest recipient of EU pigmeat, with a rise of 10% forecast for 2022, back almost to 2019 levels.
In the other direction, EU pigmeat imports from the UK are expected to rise by 34% this year.