Pig values rise, but not enough for producers

UK finished pig prices are still well below where they need to be for businesses to remain viable, despite small gains in recent weeks.

Industry bodies are calling for retailers to pay more than £2/kg to cover increased on-farm costs.

The EU-spec standard pig price (SPP) rose by 3.56p/kg on week-earlier levels to 150.55p/kg for the week ending 2 April, according to the AHDB.

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Prices have risen for six consecutive weeks and are up by 8.82p/kg on year-earlier levels, but many producers are still making significant losses.

On-farm costs

The National Pig Association (NPA) released a case study of one of its members that showed feed accounts for 65% of total costs.

Feed prices have reportedly risen £100/t and more than £25 a pig for finisher feed.

UK May feed wheat futures stood at £303.75/t at midday on 6 April, an increase of nearly £80/t since the start of the year.

Backlogs of pigs are exacerbating the situation, with finishers having to be kept on farm longer at an additional cost to producers. If pigs become too heavy, producers face penalties of more than £60 a pig.

NPA chief executive Zoe Davies said: “We are encouraged by the recent price increases that are giving producers hope. But our message to everybody – ministers, processors, retailers and other buyers of pork – is that there is still a very long way to go. This is only the start.

“Many pig producers remain in absolute dire straits financially – and unless these price increases are sustained, we will lose them and, with that, our capacity to produce and supply the pork products our consumers demand.”

Europe

Prices on the Continent have risen €0.52/kg (43p/kg) since the start of February.

EU deadweight pig prices reached €182.38/kg (£152.23/kg) for the week ending 27 March.

Pig consultant and valuer Peter Crichton said price increases may still be a case of too little too late for producers on both sides of the Channel, unless there is a radical drop in all production costs and pigmeat values also continue to rise.

Many European countries have received support through compensation and funding, such as in France, Poland and Ireland.

The UK is not currently offering support payments, adding to concern that without support, the UK pig sector could decline, bringing a heavier reliance on imports.