28c/kg Drop in Pig Price
The pig price has suffered greatly in Ireland since the Covid1-19 pandemic hit. The Irish pig price has dropped from €1.96/kg at the beginning of February to an average of €1.68/kg on the week beginning Monday 18th May. This 28c/kg drop in price translates to a devaluation of a factory pig by €23, and for the average Irish pig farm with 750 sows, that means a reduced income of €9,200 per week. With current production costs, which have increased due to Covid-19 restrictions and some feed price increases in recent weeks, pig farmers once again find themselves back at near break-even prices. Teagasc, along with many market analysts, had predicted an average pig price of over €2/kg for 2020 back in January. Most pig farmers have undertaken renovation and essential maintenance work on pig farmers, work that was continually on hold due to low return for previous years. Without a market price recovery in the second half of 2020, pig farmers face more uncertainty about the long-term prospects.
Many pig producing countries across the EU have experienced great disturbance to their pig production throughput. Many pig processing plants experienced great difficulties in coping with physical distancing requirements, and outbreaks of Covid-19 among meat factory workers has been common, right across Europe. This delay in processing capacity, combined with no foodservice demand, which is an important outlet for pork across Europe, lead to a sharp decline in European pig prices. The European average pig price hovers at €1.60/kg with many countries still struggling to keep factory ready stock processed.
The important Chinese market has returned to the marketplace and product is back on the move again, which is a positive development. The price has tumbled from late 2019 levels, but the overall deficit in pigmeat in China will hopefully underpin sustained demand at profitable price levels.
The IFA continues to engaged with all pig processors, both at individual level, through the Committee Chairman, Tom Hogan, IFA President Tim Cullinane, and Pig Committee members and with Meat Industry Ireland (MII) representatives, Cormac Healy and Joe Ryan. The priority was always to ensure that the processing of the weekly pig kill continues uninterrupted and contingency plans were in place from an early date.
IFA Pig Committee Priorities
The Pig Chairman said that pig farmers have taken enough pain, with 28c/kg of price cuts too much for any sector to take. He called on the industry to hold prices, and return stability to the marketplace. The increased retail demand combined with Ireland’s good market access to China, along with recently announced market access to Mexico has to improve the return to farmers.