Potential for growth
At the Herning Congress in October, Danish pig industry leaders called on the government to be their partners in unlocking the huge potential of Danish pig production, by adopting a more flexible approach to environmental regulation and bureaucracy to end the flow of piglets outside of Denmark. In the meantime, as Danish Crown and Tican declared the year-end bonuses for their farmer members, it appeared that the Danish pig herd was now stabilising its numbers.
‘More with less’ (‘Mere med mindre’) was the rallying call at this year’s annual Pig Congress at Herning in Jutland. The event attracted over 2,000 delegates – farmers, politicians and the media, the pig supply industries, overseas visitors and just about anybody with an interest in pig matters.
The overriding message was clear. If the business environment is improved, production capacity increased and environmental regulation is more targeted, Danish pig production will offer – within a ‘sustainable production’ scenario – the potential for over 10,000 more jobs in Denmark and additional export value of DKK 15 billion by 2030.
The analysis is based on developments over the past 30 years, when production has increased from approximately 10 million to 30 million pigs, while at the same time environmental impact has decreased. Today two pigs are produced with the same environmental impact as a single pig in 1985.
”The analysis is a wake-up call to Danish politicians, producers and companies. Do we want growth and to capitalise on the growing global demand for food - and the fact that we in Denmark are among the countries that produce food with the lowest environmental impact and the highest food safety standards - or do we want to stand still and let other countries take over our jobs and the value which might be created for the whole of Danish society?,” asked the Chairman of the Danish Pig Research Centre, Lindhart Nielsen.
”If we are to harness this potential, we need capacity in the processing sector to process the extra raw material and to ensure that the increased production of pigs in Denmark is coupled with more targeted environmental regulation. We would do well to scrap old production systems that adversely impact on the local environment, but we need to find space for new production systems. We also need faster and more flexible processing of environmental and building applications.”
Although the significant structural developments in agriculture mean that there will be fewer Danish pig farmers, by 2022 more pigs will be produced in Denmark than there are today. This is the conclusion of a new report released by the Danish Pig Research Centre.
Specifically, long-term forecasts for the structural development of pig production mean that the number of pig farms will fall to just over 2,200 in 2022, while the number of sows will increase slightly by 50,000 to 1,086,000. At the same time, increasing productivity will mean that piglet production will increase to 36.4 million and finisher production to 23.8 million in 2022 or 4 million more pigs.
”Every ten years, the number of our farms is halved and there are no signs that this trend will not continue,” said Mr Nielsen. “We don’t regard this structural development as in any way negative. On the contrary, it reflects the fact that pig farms are keeping pace with market developments and becoming more specialised and efficient.”
In Nielsen’s view, structural development is necessary in order that pig producers can maintain their competitiveness and ensure satisfactory revenues in a strongly competitive international market. Structural development means increased productivity, greater cost efficiency, better access to finance, better use of technology and more innovative approaches.
“If politicians do not create a better business environment in Denmark very soon, we will risk ending up as a “nursery” and millions of pigs and jobs will simply flow out of the country,” said Mr Nielsen.
Mr Nielsen also highlighted other areas where Danish pig producers operate at a competitive disadvantage.
Danish legislation, restricting the application of nitrogen to soil, results in farmers achieving a lower yield and harvesting grain with a lower protein content than their European colleagues. Last week, Aarhus University published figures that show that Denmark under fertilises its fields and that yields could be increased by 3 to 5 hkg per hectare. Low supply of nitrogen to the soil has also meant that the protein content in cereals has fallen by about two per cent over the past 20 years.
The Danish Pig Research Centre has calculated this as an overall loss of more than DKK 420 million per year for Danish pig producers on the basis of a self-sufficiency rate of 60%. The loss accounts for approximately DKK 18 per pig from birth to slaughter.
“If we could fertilise our fields at a more appropriate level, the protein content of cereals would also increase by two percentage points, which would reduce the requirement for imports of soya by up to 25%. We would achieve more sustainable production and a higher level of self-sufficiency,” said Mr Nielsen.
The many debates at Herning Congress received widespread coverage in the trade press here, including:
In the meantime, the results of the October census showed a modest decline in pig numbers in Denmark. There was a small drop in the overall number of breeding sows, but the results suggest that production levels may be moving to a more stable position, although the continuing flow of weaners from Denmark continues to present a headache for the industry.
Despite the very challenging trading conditions, Danish Crown and Tican announced year-end bonuses for their members of 90 øre and 85 øre respectively for pigs delivered over the year – around 10p per kg.