Food manufacturers to face pigmeat double whammy

16-Aug-2012 - Last updated on 17-Aug-2012 at 10:33 GMT

Related tags United kingdom European union

Pork prices could soar if high feed costs and new EU welfare rules prompt producers to quit production

Food manufacturers could face steep rises in pig meat prices, as soaring feed costs drive UK pig producers out of business and new EU welfare rules force continental producers to quit.

Jon Bullock, communications manager with the British Pig Executive (BPEX), told FoodManufacture.co.uk: “There will definitely be a significant increase in prices for food manufacturers as UK pig producers struggle to cope with much higher UK feed prices.

“That will be magnified when the sow stall and tether ban comes into force on January 1 2013 if [continental] producers are driven out of business.”

Pig farmers have faced a 25% increase in the cost of pig feed over the summer as the US drought has cut yields of wheat and soya.

A recent survey by the National Pig Association (NPA) revealed that if pig prices and feed costs remain at present levels, producers representing 10% of the weekly pig kill said they would continue production only until Christmas.

Run out of bank funding

By about that time, producers representing 12.5% of the weekly pig kill said they expected to run out of bank funding.

Also, producers representing about 66% of the weekly kill said they would stay in production for a further 12 months.

Respondents supplied 46,080 slaughter pigs a week, covering about 30% of Great Britain’s weekly output of pigs.

The NPA said: “The British pig industry is in a race against time. It needs to persuade all actors in the supply chain, between now and the end of the year at the latest, to work together to achieve a producer price that reflects the recent rise in feed commodity prices.”

BPEX predicted that up to 10% of European pig farmers would stop production when new EU welfare rules ban the use of sow stalls and tethers. While UK producers already comply with the new legislation, many continental producers will need to invest heavily to meet its requirements.

Stephen Howarth, BPEX senior analyst, described the likely outcome as “simple economics”.

Real shortages

“Production losses on this scale would lead to real shortages of pig meat in the EU market and would mean substantial price increases and processors and retailers competing for supply,” said Howarth.

Clare Cheney, director general of the Provision Trade Federation, said her organisation, the Department for Environment, Food and Rural Affairs and BPEX would lobby Brussels to ensure that all 27 member states enforced the sow stall and tether ban.

“We have all pledged to do our very best to ensure that all pigmeat products come only from producers who comply with the legislation,” she said.

The British Meat Processors Association said there was no excuse for governments failing to implement the new rules.“These governments have had more than enough time to ensure that the ban comes into place on time and works to full effect,” said a spokeswoman.

Pig production in numbers

12 – Months in business for producers representing 70% of UK pig output, unless prices improve.

10 – Percentage of national pig production accounted for by producers who plan to quit by Christmas.

10 – Percentage of EU pig producers who could quit due to partial sow stall and tether ban.

Source: NPA

1 comment

If we want to continue to eat ethically fed pigs ...

Posted by Ian Steele, 17 August 2012 - 21:18 GMT

This is a crucial issue. This is not a ‘what if’ scenario, or the potential for a tipping point some years down the line. We all need to secure sustainable food sources that don't rely on mono-cultures grown and imported from around the world at the expense of other population's primary food supply.

Here on Treflach Farm we currently buy 'Identity Preserved Soya' based pig feed. This means we can be sure the soya part of our feed (about 80%) is sourced from developed world farms - not slash and burn rainforest plantations.

So far, so good. But it is not great when you consider droughts in the US, floods in Pakistan, Russia and Australia, which are the supposed 'bread baskets' of the world. How can we justify depriving other peoples of the world of their staples (soy, maize and corn) for our luxuries of bio-ethanol (routinely and increasingly added to our petrol and diesel) and animal feed?

Then, there is the false choice between GM or increased fertiliser/pesticide/herbicide use.

The answer, in our view, is to become self-sufficient; do away with the need for bought in feed completely. Grow many types of fodder to relieve the pressure of one crop failing.

It may take longer to finish the animals (like our grass fed beef) and you may not be able to grow so many on a small plot of land. But that's a benefit not a hindrance. By its very nature, this kind of decentralised, small-scale and ethical farming draws in people and energy.

These networks build local economies and create jobs and local resilience. Big farms merely store up trouble, forever chasing economies of scale at the expense of people and animals. Small-scale farms can, and do, work by feeding themselves and those around them. Big business will not be happy. And looking to the continent for cheap imports looks tricky.

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