February 25, 2008

Low pork prices in the UK could threaten hog industry
 

The UK could face a shortage of pork, and an exodus of pig producers by the end of the year if pork prices remain at its current low level.

Supermarkets have to pay producers a higher price to cover the rise in feed costs, said the National Pig Association (NPA).

NPA general manager Barney Kay warns that many producers are prepared to exit the industry if market prices do not increase to cover the high production costs.

Kay said a producer needs only about 10 months to quit the industry and although now retailers can say there is still pork in the market, the situation could change greatly within a year.

Feed prices have increased by more than 100 percent over the past year, and most producers are losing about US$51 per pig.

Retailers have also been reluctant to promote an expanded range of premium pork products across the pork sector due to the availability of cheaper products, which partly contributes to the problem at hand, said Kay.

Data from Pork Watch, an independently audited market report for the British Pig Executive, shows that retailers relied heavily on imported hams. Only 9 percent of ham and bacon at Co-operative Group are domestically produced, and 12 percent at Asda.