Pig producers back in the red

By Peter Crichton

THE UK AESA has dropped below 100p/kg for the first time since mid-June, and many producers will now be selling pigs below cost of production.

Although the AESA stands at 99.32p/kg deadweight, after haulage costs and grading and marketing deductions producers will find it hard to achieve more than 90-95% of the contract price.

According to Signet, the variable costs alone to produce a bacon pig are 41.28/pig.

Labour and other fixed costs can account for 40-60% of this figure and, for many herds suffering from PDNS and PMWS, additional mortality and medication costs will lift the overall production figure above 100p/kg deadweight.

Producers cashflows have also been hit by the collapse in cull sow values.

With the current sow worth 30 on the welfare scheme and little more on the commercial market, a typical 250-sow herd with a 40% replacement rate is looking at a revenue loss of 7000 per annum compared with pre-foot-and-mouth levels.

Ration costs have increased, with FARMERS WEEKLY feed wheat prices up 8% over the past 4 months, barley up by 4% and Hi-Pro Soya by 11%.

Home-mixed rations have also risen, with sow feed up by 2%, rearing food by 21% and finisher food by 5%.

• Peter Crichton is a Suffolk-based pig farmer offering independent valuation and consultancy services to the UK pig industry
• Pig deadweight prices
• Pig price trends