What exactly are the big retailers doing to help the pig sector through its crisis?
10th Jun 2022 / By Alistair Driver
Over the past months or so, four of the big UK retailers have announced significant investments in the pig price to support beleaguered pig producers.
The headline figures announced by Sainsbury’s, Waitrose, Tesco and Co-op, at face value, amount to around £50m, while other retailers are known to be upping payments, without making it public.
It appears to be making a difference. The pig price, despite artificially high supplies of pigs as processors work through the backlog and ‘soft demand’, continues to rise, with the SPP topping 180p/kg for the first time ever during the week ending June 4, giving producers some immediate relief and belief in the future.
But, while retail support is welcome, pig price increases are barely keeping pace with soaring costs. For context, pig producers lost, on average, a staggering £58/head during the first quarter of this year, taking overall industry losses since October 2020 to an estimated £500m, according to AHDB.
This was based on estimated average costs of 207p/kg. As wheat prices have soared further since the start of the Ukraine war and energy prices go higher and higher, AHDB estimated that average COP had reached 240p/kg in May.
“The bottom line is that, while all retail support is welcome, it is still nowhere near enough, and some are certainly doing more than others,” NPA chief executive Zoe Davies said.
Based on public statements and what else we know, with Zoe's help, the latest issue of Pig World looked at what each of the big retailers is doing to support the British pig sector, particularly in relation to their market share.
- You can view the full analysis HERE
It shows very clearly how some, particularly Waitrose and Co-op, are doing much more than others, some of which appear to be doing very little.
We also hear from some the big processors, who are calling for the retailers to do more. "We encourage all stakeholders throughout the supply chain and in government to do all they can to ensure a sustainable future for British farmers and the UK pork sector," a Pilgrim's spokesperson said.
Most importantly, we summarise the views the producers at the sharp end, who, while welcoming the efforts made so far, highlight why they desperately need the pig price to continue rising for the foreseeable future.
“We are seeing some of the benefit of higher prices coming through, although some customers are notably better than others. Despite these improvements, even on our best paying contract we are still losing £26 per pig,” one said.
Another added: “We have seen nothing yet – nothing is coming through to the farmer unless you are in dedicated supply chains like Waitrose and M&S."