We use cookies

By using www.agricultureandfood.co.uk, you agree to the use of cookies. We use cookies to improve usability and for website statistics. You can read more about our privacy and cookie policy here.

Improving outlook

Presentations given at the recent AHDB Outlook Conference highlighted the improved profitability currently enjoyed by British pig producers, due to higher market prices and lower feed costs during the last six moths. Despite these improving fortunes, it is not expected that there will be any significant increase in the UK pig herd, although better productivity will lead to an increase in pig meat production.

The AHDB 2014 Outlook Conference took place in London on 12th February. The conference reviewed the prospects for the British livestock and dairy industries in the coming year.

The conference presented a generally optimistic picture for British pig producers over the next year or so. Most producers have been enjoying better profitability for some months now as pig prices rose sharply and feed prices fell back during the second half of 2013. Current indications are that the price of most cereals and soya will remain at these levels for the foreseeable future. 

As reported in Pig World and elsewhere, the December census results in key EU Member States suggested that the breeding herd was now 2% lower than the previous year, with only Denmark and Holland, among the main pig producing countries, showing any increase in numbers. With only a modest recovery of EU production expected during 2014, supplies to the UK market will remain relatively tight over the year as a whole.

Despite the improvement in profitability, BPEX do not expect any significant expansion of the UK breeding herd in 2014, as most producers will use their improved cash-flow to pay down previous indebtedness. The unpredictability of feed prices and 'vulnerable' margins may yet be factors affecting British producers' confidence in the future. However, domestic pig slaughterings and and pig meat production will show a modest increase in the coming year, as productivity will continue to improve.

It was forecast that the UK breeding herd would rise from 412,000 sows currently to 425,00 by 2015.

Although a stronger £ may limit export opportunities in the coming months, BPEX reported that exports of British pig meat reached 256,000 tonnes during 2013, the highest level achieved since the year 2000, just before several key export markets closed their doors to exports in the wake of the outbreak of Foot and Mouth disease.

In this connection, it was widely reported in the trade press that Tulip was completing a £37m investment to upgrade its UK facilities and would be in a strong position to take advantage of the recent re-opening of the Chinese market for exports of British pig meat.

However, the BPEX presentation also highlighted a number of ‘wild cards’, which may affect current expectations – not least the outbreak of pig diseases in Russia and the US (see ‘ASF and PEDV update’)

All the presentations made at the Outlook Conference may be accessed at this link