Simple measures a
must for pigs
With falling incomes across all livestock sectors, FW
reporters ask MLC strategy managers for some advice
on what can be done practically to improve margins,
while some producers share their New Year thoughts
on how they plan to counter falling product prices
PIG producers could take simple measures to ensure margins are maintained, according to MLC pig strategy manager Mick Sloyan.
"Despite cereal prices being lower there will be considerable downward pressure on pig prices from a huge 10% increase in supply," says Mr Sloyan.
"Prices are, therefore, unlikely to recover this year and controlled cost cutting, based on a comprehensive cost review, should be the first target for producers hoping to maximise margins in 1998," he says.
Any obvious areas where costs can be reduced will be apparent if the review is far reaching enough.
But he warns that as well as cost cutting, planned investments must still go ahead. "When margins are pressurised there is a temptation to cut corners. This could be a false economy as careful investments can make a difference to returns very quickly," says Mr Sloyan.
He suggests producers could adopt relatively simple building improvements, such as those made at the MLCs Stotfold development unit, which have improved health and cut energy inputs by 50%.
Improvements in health have also been achieved by side-streaming at Stotfold.
"This has enabled us to remove sick pigs to a hospital pen, where they are fed and treated in smaller groups, so they recover and reach sale weights quickly," says Mr Sloyan. The result is more even batches of pigs at finishing which can then be marketed at the optimum stage to meet contracts.
Hitting the contract spec is vitally important particularly in periods of lower prices, suggests Mr Sloyan. "During times of high prices producers often allow the number of pigs falling outside a contract to drift," he says.
Producers should, therefore, check grading sheets weekly and compare them with the contract. Every pig sold within the contract is worth an extra 3p-5p/kg – which could make the difference between profit and loss this year, he adds.
• Controlled cost cutting.
• Planned investments.
• Hitting contract spec.
Mick Sloyan, MLCpig strategy manager…hitting the contract spec is vitally important in periods of lower price.