Pig sector calls for £3.2m government aid package
© Tim Scrivener The pig sector has requested £3.2m in government support to compensate farmers for poor prices and lost trade due to Brexit, Covid-19 and African swine fever (ASF).
The package was formally requested by the National Pig Association (NPA), which has been engaged in weekly crisis meetings with Defra and supply chain bodies since February.
Supply chain representatives had initially wished to avoid calling for government backing, instead pinning hopes on marketing initiatives to bolster incomes.
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However, marketing drives such as price cuts and promotions have failed to tackle the depth of hardship being encountered on farms. More than 75% of farmers are operating at a loss of about £25 a pig, according to the NPA.
Zoe Davies, chief executive, said the price pressure had forced farmers to quit, with 20 farms and 10,000 sows lost to the sector in recent weeks.
Poor prices have been caused by oversupply in Europe amid China’s ongoing ban on German exports due to concerns over ASF. This has seen pigmeat prices plunge for products earmarked for export that then flooded back onto the EU market.
The post-Brexit open-door policy on EU imports saw some of this cheaper pork arrive in the UK, undercutting prices.
The Chinese government has also banned imports from key British plants affected by Covid-19 – Cranswick’s Watton site, Pilgrim’s Ashton plant and Quality Pork Limited’s Brechin unit.
The combined cost is £600,000/week in lost UK sales, according to British Meat Processors Association figures.
Pig backlog
Meanwhile, low staffing levels at plants caused by Covid-19 safe working practices and outbreaks of the virus have compounded the issue.
At its peak, a backlog of 100,000 pigs awaiting slaughter were housed in temporary accommodation on UK farms. This pushed up carcass weights, leading to swingeing price discounts imposed by processors.
Once a pig exceeds a certain weight, a penalty is applied on a per-kilo basis across the whole carcass, Dr Davies explained.
For example, punitive prices of 75p/kg are paid for a 105kg carcass, reducing its value from £147 to just £79.
Dr Davies questioned the need for the discounts because pork does not lose quality at higher weights, in contrast to lamb and beef.
She said the combination of factors meant the pig sector was enduring unprecedented times.
“The entire UK pig sector has been hit by this situation and, given that compensation has been paid to other sectors, such as dairy, we believe we have a very justifiable case,” Dr Davies said.