Improving prices could boost British pigs

UK pig production could get a boost from improved prices and lower costs, according to Stuart Ashworth, head of Economics Services for Quality Meat Scotland (QMS).

Ashworth said the steady increase in pig producer prices over the past 12 months pointed to an “underlying strength in the market”, which had been further strengthened by a 4% drop in imports as a result of firming prices across Europe in the first half of the year, and an increase in UK exports.

“The net effect of this trade meant the quantity of pigmeat on the home market fell by 3% over the first half of the year, encouraging price rises,” he said.

Ashworth said a steadying of feed prices had also helped improve the economic situation for UK producers.

“Twelve months ago, feed prices rose significantly on the back of tight global supplies and producer margins fell sharply,” he said. “More recently, as the northern hemisphere harvest got under way, protein and grain prices have eased and are currently trading around 10-15% lower than 12 months ago.”

He pointed out that the latest June census suggested improved returns had resulted in lower sow slaughterings and a small increase in the number of gilts intended for breeding farms.

“Together, these two indicators point towards an increase in the size of the UK sow herd in the short term,” he said.

However, he added that “this may do no more than return the breeding herd to the size it was 12 months ago” and pointed out that falling prices across Europe could have an impact on UK prices, which are already increasing at a slower rate than in August.

“With the UK and European sow herd remaining significantly smaller than it was five years ago, even a modest increase in herd size and productivity will still leave European production tight by historic levels,” he said.