Crisis to deal severe blow for Dutch swine industry

The financial crisis is seen to create havoc for the pig industry in the Netherlands as prices will take longer than usual to recover this year with exports also projected to decline , according to Dutch researchers.

Under normal circumstances one would expect to see an improvement in prices in 2009 due to an expected decline in pigs in the EU, wrote Dutch research institute LEI Wageningen in its March report on the effects of the crisis in the farm sector.

But that recovery has been disrupted by the financial crisis, with exports to Eastern European countries and outside the European community falling, according to author Kees de Bont.

High feed costs and low prices have dropped incomes of Dutch pig farmers in 2007 after three years of stable and relatively high incomes. While pig prices improved in 2008, in a normal cycle that recovery would continue in 2009, de Bont said.

The price of pigs from Dutch farms slipped 3 percent in February 2009 compared to January, a table in the report showed. The price of piglets slipped 1 percent in the same period and is seen heading lower in 2009.

De Bont projects several farmers to halt production for a longer period for prices to start recovery towards the second half of 2009.

He said Dutch poultry exports were faring better than in the pig sector as consumers were turning to cheaper products in the economic downturn. Poultry prices are expected to be stable in 2009, de Bont said.

He also said the price of eggs was rising monthly after animal welfare requirements in the EU had led to reduced production. Prices of eggs from Dutch farms were up 7 percent in February compared to January and are expected to rise further.

De Bont said lower animal feeds prices were reducing farmers' costs significantly, easing the burden on incomes.