Pig producers need dramatic increase in prices

Pig producers will need the deadweight prices to hit at least 125p/kg during the first six months of the year to keep pace with rising feed costs.

Although the Great Britain Euro Average Deadweight Pig Price, against which most contract prices are calculated, ended the year 2% higher at 110.31p, spot quotes fell by 8% over the same period.

Most weaner producers are also trading at a loss with ex-farm averages of £32.73 a head down from £34 a head in December 2006.

And since then the industry has also been challenged by the lethal combination of sharply rising feed prices and the 2007 foot-and-mouth outbreaks.

Feed wheat prices have leapt to more than £160/t compared with less than £90/t a year earlier, while soya values have also soared over the past 12 months from £154/t in December 2006 to about £250/t.

UK average pig slaughtering numbers for 2007 were greatly disrupted by the last summer’s foot-and-mouth outbreaks and subsequent loss of export markets, which had a similarly devastating effect on cull sow slaughterings.

But despite the export ban, the 2007 average weekly cull sow kill of 4000 was up by just over 5%.

However, once exports were restored, cull sow export values were helped as the pound slid to its lowest against the euro in its nine-year history. The value of the euro rose over the 12-month period from 67.5p to 73.5p effectively adding 9% to the cost of imported pigmeat.

But further reductions in the size of the UK pig herd are expected when the December 2007 census results are released.

The June 2007 census brought warnings of further drops in the number of future breeding sows in the system with in-pig gilt placings down by 21%.