Pig Outlook Forum: NPA chair highlights desperate need for further pig price rises
13th May 2022 / By Alistair Driver
NPA chairman Rob Mutimer has highlighted why pig prices need to rise significantly higher to stem the huge losses from pig farms and ensure the future viability of the sector.
Addressing the well-attended Pig Forum during this week’s two-day British Pig and Poultry Fair, Rob demonstrated the how the impact of the Ukraine war on feed prices has hit his pig business.
He said the cost of production on his 700-sow outdoor pig farm in Norfolk has increased by 52p/kg following the invasion in late-February and is forecasting that it will be in the region of 237p/kg, or even as high as 243p/kg by late-summer/early autumn.
Pig prices have also risen since the invasion, up from 1.35p/kg at the time to more than 170p/kg at the end of last week.
“That completely defies all economic logic as during that period of time we had a surplus of probably 150,000 pigs at the time and we've had a surplus all the way through,” he said. “From a producer's perspective, while that's not nearly good enough as a rise, it does indicate that someone does actually want to buy a pork going forward. If not, the price would probably still be 135p/kg.
“But while the rise is great, we're still losing an awful lot and it still nowhere near the 52p/kg rise in our cost of production since late-February.”
Rob described the fact that we still have what the NPA estimates is between 70,000 and 100,000 pigs backed up farms, nearly a year after the problems first emerged should be seen as a ‘real embarrassment’ to everyone in the industry.
“We should never ever have got ourselves into this position for this long. The personal toll it's taken on a lot of people in the industry, both producers and in the allied industries, has been horrendous. We must ensure we don't end up making farms a lairage in the future again.”
He stressed the need, longer-term, for much more sound contractual relations between producers and pig buyers. He said it was a ‘disgrace’ that many current contracts were written 15-20 years ago and have never properly been updated.
Better forecasting was also vital to ensuring more a more functional supply chain, he added.
Rob shared the stage on both days of the event with Karro chief executive Steve Ellis, who urged the entire pig supply chain to increase the price paid to producers to beyond the £2/kg mark.
You can view the full Pig Outlook forum HERE