Difficult financial outlook for UK pig producers

Source: Pig333.com, 13 September 2021, photo credit: BSDZINE

The first half of 2021 represents the worst financial situation for pig producers, across a six-month period, on record.

Estimated Great Britain pig production costs in the second quarter of this year reached a record 182p/kg, according to the latest AHDB estimates. This was an increase of 8p/kg from the previous high of 174p/kg recorded in the first quarter of this year. Compared to the same time last year, production costs were 27p/kg higher.

The increase primarily reflects rising feed costs, however, both labour and fixed costs had also increased compared to the first quarter of 2021.

Pig prices have also increased compared to the start of the year. The APP [(All Pig Price) GB average deadweight pig price achieved by producers each week] averaged 154p/kg in Q2, 9p/kg more than during the first quarter. However, compared to last year, prices are 13p/kg lower.

This means that, on average, pig producers remain in a significant loss-making situation. Estimated net margins stand at -28p/kg (or -£24/head) in Q2 2021, a similar situation to the first quarter.
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The South African Pork Producers’ Organisation (SAPPO) coordinates industry interventions and collaboratively manages risks in the value chain to enable the sustainability and profitability of pork producers in South Africa.