Pig farmers’ share of retail price plummets to 11-year low

Pig farmers’ share of the retail price of pork has fallen to just 34%, which is its lowest level for 11 years, according to figures from AHDB Pork.
Farmgate pig prices fell 2% in the month to October, the third month in a row they have gone down and the largest change since February.
While the average retail pork price only increased by 0.5p/kg in October, and remained very close to the average price for 2014, the more pronounced drop in farmgate prices over the past year meant a gap had opened up.
See also: Pig prices plummet to their lowest in seven years
Farmgate prices were 16% lower than they were in October last year, which meant the producers’ share of the retail price was 6% below where it was in the same month in 2014.
This was in sharp contrast to the position two years ago when producers’ share of the retail price reached about 43%, with farmgate pig prices at record highs.
Livestock farmers’ share of retail price by sector |
||
|
Farmers’ share of retail price (2014) |
Farmers’ share of retail price (2015) |
Pork |
40% |
34% |
Lamb |
44% |
43% |
Beef |
51% |
49% |
Source: AHDB |
Pig prices in the UK and EU remain low
In the week ending 14 November, the UK-spec standard pig price was 124.19p/kg which is 20p behind the same week in 2014 and over 43p/kg down on the UK-spec deadweight average pig price of two years ago.
The current breakeven price for producers is estimated to be about 139p/kg.
The situation across Europe is just as difficult.
EU pig prices are at a nine-month low because of the high number of pigs being marketed and at heavier weights.
“With the pound strengthening against the euro, UK prices have actually increased in euro terms in recent weeks,” said AHDB Pork.
“As a result, the gap between UK and EU prices has begun to widen again, reaching €38/100kg (27p/kg) in the latest week.”
Pork struggles to attract shoppers
According to data from Kantar Worldpanel, retail pork sales struggled over the 12 week period ending 11 October 2015.
Pork purchases were down across most cuts, with chops and steaks seemingly falling out of favour and roasting joints dropping in volume by 6%.
Only mince and meat offered with a pre-prepared marinade bucked the trend.
Holding retailers to account over misleading labelling
In a bid to halt tumbling farmgate prices, the National Pig Association (NPA) launched a Christmas GammonWatch campaign, which will involve naming and shaming retailers failing to stock British gammon.
The NPA said typically only 30% of gammons for the festive market were British.
It said in previous years many retailers, and restaurants, had relied on cheaper imported pork, which had been cured in Britain and had then been legally, but misleadingly, labelled as “Produced in the United Kingdom”.
“If retailers want the convenience of a thriving British pig sector on their doorstep, producing reliable supplies 52 weeks of the year of a quality-assured, traceable, high-welfare product, then it’s essential they make a special effort to support British pig farmers over the Christmas period,” said NPA chairman Richard Lister.