May 12, 2008

New Zealand pig producers to benefit from low prices in the long run
 

New Zealand's pig producers may be hurting from low pork prices but they may benefit when demand soars.

Pork is now the cheapest meat in New Zealand due to pork imports, according to Sam McIvor, chief executive of New Zealand Pork.

While consumers are benefiting from the prices at the expense of the producers, but the low prices would drive greater demand which would increase returns for the producers, said McIvor.

The organisation hopes to dispel the public perception that pork is more expensive than chicken, which rose 20-30 percent in price from last year.

Production costs have increased due to rising grain prices but New Zealand's producers have offset the costs by improving pig production and mortality rate. However, the producers also have to face the strong competition of imported pork.

Despite so, the future grain market is beginning to soften while forecasts for South Africa's new season grain and Australia's drought have been positive.

New Zealand supplies about 45 percent of domestic total pork consumption.