Efficiency a must

To survive in the unsupported sector of pig production there has to be a desire for technical efficiency.

And that will be on the minds of prospective viewers looking at an opportunity in East Yorkshire, where one farming concern is offering a 2000-sow multi-site pig operation to the market to concentrate on other enterprises.

It’s a move likely to attract domestic and, possibly, mainland EU interest, says one joint agent.

This business offers both size and self-containment having its own multiplication, finishing and feed mill elements that may attract overseas players.

No doubt prospective viewers will know the sector has been through difficult times in recent years.

The price crash in the 1990s, reinvestment demanded for the stall-and-tether ban, and foot-and-mouth still weigh heavily on operators’ minds, say observers.

But there is better news.

The DAPP is currently just over £1/kg deadweight, allowing efficient producers to make a profit, albeit below the heady heights of the last decade.

It’s still no easy ride.

Intensive pig operations can place big demands on capital with industry figures suggesting buildings, finance and miscellaneous items account for about a third of production costs.

This operation has seen capital spent to improve facilities in recent years but more could be invested to suit.

Another important attribute flagged up by agents is the business’ location to two major processing facilities – a valuable asset in today’s supply-chain driven world.

Prospective purchasers will want to explore the ability to use surrounding arable ground for nutrient recycling (spreading manure and slurry) to meet NVZ and IPPC legislation.

That’s been factored in and shouldn’t be a problem, he adds.

There’s also a settled labour team in place – a bonus as this region, like others, can still find replacing staff a long process.

For purchasers, there are some encouraging signs for the future of the domestic pig sector.

Industry estimates suggest the UK sow population could stabilize at 460,000 sows after a period of decline.

UK costs of production are marginally ahead of EU competitors and while pressure from imports will continue, consumption rose slightly in 2005, report advisers.

Given these parameters, technical efficiency will be paramount to profit in this sector.