NPA chief blasts supermarkets

The National Pig Association chairman Stewart Houston has launched a withering attack on the major retailers’ lacklustre support for the British pig industry.

He said that, despite retailers acknowledging some of the problems facing pig farmers, they are unable to grasp what needs to be done to avert a crisis.

“Urgent action is needed,” said Houston. “ The retailers have to have a change of policy. If they don’t do more, the consumer will end up paying the price, as there will be such a shortage of British pork, it will make it expensive. The less that’s paid now, the more will need to be paid in the future, due to the tightening of supply.”

Houston spoke out after retailer Sainsbury’s announced a rise in the amount paid to its dedicated pork development group. It has pledged to make a discretionary payment, together with its suppliers, of an additional 5p/kg until 1 August 2011 or until the deadweight average pig price (DAPP) stabilises to £1.50/kg. 

However, with the DAPP estimated to reach £1.50/kg within two to three weeks and 2p/kg of Sainsbury’s pledge already being paid by the processor, the gesture seems cosmetic. Houston said the short-term tactics of adding the odd penny per kg would not tackle the long-term strategic problem and that a fundamental shift in retail was required. He said: “It demonstrates they haven’t understood the situation [of the pig farmers], who have been struggling since August last year.”

With global commodity prices up, pig production costs have climbed to £1.64/kg. To return to profitability, British pig producers need the DAPP to rise to around £1.70/kg.

Since June 2010, the price of feed has doubled, and now accounts for 77% of total pig production costs. 
In response to Houston’s remarks, a Sainsbury’s spokesman said: “We work closely with our farmers and suppliers to ensure we are paying a fair deal for the best British produce for our customers. We are keeping the payment under review and will continue to use our pork development group as a forum for discussion.”

A spokesman for Asda said: “We know that times are tough for pig farmers, which is why we have been paying an additional 8p/kg since the start of this year. This has been a considerable investment on our part of several hundred thousand pounds. We have regular meetings with all our pig farmers and have shared our plans for increasing sales of British pork with the NPA and Bpex.”

A Tesco spokesman said: “Tesco sells more British pork than any other retailer and recognises the need to maintain a sustainable supply chain so we can continue to offer our customers high-welfare, quality pork at competitive prices.”

Bpex has released a new report, which states that British consumers are buying more pork products. But it claimed the growth has come at the expense of welfare-assured pork produced to Red Tractor standards as retailers use cheaper imports, much of which would be illegal to produce in the UK.

>> Retailers accused of breaking pork promises