Danish Crown cuts 500 workers due to pig shortage

Higher costs and fewer pigs being finished across the EU have led to redundancies at Europe’s largest pig producer, Danish Crown.

The farmer-owned global meat producer will make 500 redundancies, many of them likely to be in Denmark.

Job cuts and additional cost-saving measures are forecast to save the company about 500m kroner (£56m) each year.

In the UK, Danish Crown operates eight sites and employs 900 workers. It is not known yet to what extent the redundancies will affect the UK operation.

See also: Pig prices slip back below 210p/kg after months of stability

Group chief executive Niels Duedahl said: “Danish Crown is in the midst of a crisis, and we are facing sweeping changes. Our costs are simply far too high in relation to our earnings.

“It goes without saying that we are obliged to act on this, and we are now adjusting our organisation and focusing 100% on the core business to ensure better settlements for the farmers who own Danish Crown.”

Mr Duedahl added: “Behind our problems lies a great untapped potential, which I know a focused organisation can unlock when we make the tough, but right decisions.”

Profit fall

Net profit for the first half of the 2023-24 financial year totalled 764m kroner (£85m), down from 902m kroner (£100m) in the same period of the previous year. Revenue fell 3% on lower volumes.

The company said the lower trading volumes were driven by a reduced supply of pigs for slaughter in several of its main markets.

It added: “The production of pigs in Europe currently decreases significantly, as increased production prices have led to pressure on the economics of pig producers.

“This effects the supply of pigs in Denmark, which has decreased by 12% in the first half-year compared to last year – meaning a total decrease of 23% over the last two-year period.”

Tight supplies

EU pigmeat production is expected to fall by 0.5% in 2024 and 0.2% in 2025, according to the EU Commission, despite some recovery during the first half of the year.

Pork exports from the EU are forecast to be down by 2.5% year-on-year in 2024.

Pigmeat production in the UK was up 3.4% in the first nine months of 2024. However, the number of UK breeding sows remains exceptionally low by historic standards.