Pork processors demand prices rises
increase in meat prices. British Pig Executive (BPEX) chairman
Stewart Houston has written to retailer and foodservice leaders to
point out that producers in Britain and the rest of Europe are
facing a hike in the cost of feed, which is fast eating into profit
margins.
A report produced for BPEX claims that the long hot summer, which resulted in a poorer harvest, has caused feed prices to rise dramatically. More price hikes are predicted, and as the report's author Tony Fowler, a Meat and Livestock Commission senior economic analyst, points out, this is not just a British problem.
The average price of feed wheat has already risen by about 50 per cent and as feed makes up half the cost of rearing pigs, producers face a 25 per cent rise in their costs. Though the position is particularly serious for pig producers, the price rises will also have consequences for other parts of the food industry such as poultry, dairying, beef finishing and bakery products.
Across Europe, feed prices rises have been reported, with the steepest increase in southern Europe. Italy has seen particularly large rises with wheat up 128 per cent, barley up 25 per cent and soya up 32 per cent since July. There are also concerns for the future as the long hot summer which caused the problems has meant autumn grain planting has been problematic and next summer's harvest could be poor as a result.
Stewart Houston, who is also chairman of the National Pig Association, said: "British pig producers are facing a desperate situation. This is a Europe-wide problem and needs to be tackled by the EU. With prices even higher in mainland Europe, feed is being sucked out of the UK accelerating the problems here."
Houston has also written to food and farming minister Lord Whitty, asking that he urgently seek a solution from the European Commission which is responsible for managing the European grain market. "I have also written to retailers and foodservice firms to inform them of the problems and explain that prices need to rise. There is pressure for the cost of imported pig meat to rise as well. If the whole supply chain does not take action, there will be another exodus from the pig industry which would cause even more problems for our rural economy in the future."
BPEX chief executive Mick Sloyan said: "The indications are that this is a problem which could be with us for some time. The British pig meat supply chain will not be sustainable if feed and pig prices stay where they are. The gap must be closed or we are likely to see a substantial decline in pork production across Europe.
The 11-page report can be downloaded from the BPEX website.
