Pig farm net margins surged to over £8 per head in the second quarter of 2025, driven by a drop in feed costs and a steady rise in pig prices, signalling a brighter outlook for farmers after a challenging period.
Feed costs dropped by 7p to 120p per kilogram in Q2, accounting for an estimated 61% of total production costs, according to the latest quarterly figures from AHDB.
While finance and fuel expenses also decreased during this period, these savings were partially offset by rising labour costs.
The levy organisation's estimates, based on performance data from breeding and finishing herds, put the full economic cost of production for Q2 2025 at 197p per kilogram deadweight — 6p lower than in Q1.
At the same time, pig prices, measured by the Standard Pig Price (SPP), increased by 2p to approximately 206p per kilogram, leading to net margins of £8.10 per slaughter pig and 9p per kilogram deadweight.
Since the start of 2025, the cost of production and net margin figures have been calculated using the SPP rather than the Average Pig Price (APP), reflecting a continued shift that results in slightly lower reported margins.
The Q2 net margin represents a significant improvement from just £1 per head in Q1 2025 and matches the figure for Q4 2024.
This marks nine consecutive quarters of positive margins following a challenging period of 10 consecutive quarters of losses, which were estimated to have cost the pig industry over £700 million.
Looking ahead, the SPP has continued its gradual rise since the beginning of Q3, while feed costs have remained relatively low, indicating pig farmers are likely to stay comfortably profitable in the near term.
