Warning to processors and retailers and over pig prices

By Michelle Perrett

- Last updated on GMT

Pig prices have come under scrutiny
Pig prices have come under scrutiny

Related tags: Supply chain

Processors and retailers must deliver a great share of rising pig prices back to producers or risk losing the sector, NFU Scotland has warned.

In a blunt message to the the industry, the organisation warned that unless prices increase and a bigger share is given to pig farmers there will not be a British industry left. 

The trade association said that in the last five weeks, the Standard Pig Price (SPP) has risen by almost 20p/kg – some of the largest weekly rises ever recorded – but the huge increases in costs faced by producers means that pig producers are still losing substantial sums of money. 

Crippling losses

NFU Scotland’s Pigs Committee chair Jamie Wyllie estimated that current cost of production, taking surging feed, labour, haulage and energy costs into account is around 204p per kg, meaning that the SPP must break 200p per kilo soon just to allow producers to start breaking even after many months of recording crippling losses.

“In a week when some processors and supermarkets have taken the opportunity to make large PR statements about the amount of money that they are putting into their spot portion of the pig price, the reality is that it’s nowhere near enough,”​ said Wyllie. 

“While I appreciate that the pig price has risen, and that this week we saw the largest rise in price I have ever seen, we are still a long way from even covering the cost of feed, electricity, diesel, labour and haulage.”

Unfair share

Wyllie said that NFU Scotland has 'long believed' that retailers have been keeping an “unfair share” of the final sale price. 

“In the year to date, the UK pig farmer is only getting around 37% of the final sale price when, in recent years, it has been up to 42%. This 5% may not sound like very much but it would increase the price paid to the farmer by around 19p per kg. Where did that 19p go?” he said. 

Related topics: Meat, poultry & seafood, Operations

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