Pig producers seek emergency aid as losses hit £50 a head

Pig producers are losing around £50 a head and thousands of pigs could be left without contracts from October, as the NPA presses Defra for emergency financial support.

The National Pig Association has submitted a package of measures including direct price support, restructuring payments and temporary help for producers struggling to find a market for their pigs.

The proposals were requested by Defra minister Stephen Morgan in July after he met the association to discuss mounting pressure across the sector.

Independent producers are being hit by both falling prices and widespread contract disruption.

An NPA survey completed in July by around a quarter of its independent producer members found nearly half of respondents had been given notice on some or all of their pig supplies.

Some producers forced to sell pigs on the spot market are currently losing around £50 per animal, according to the association.

Further pressure is expected from October as six-month contract notice periods begin to expire.

The NPA estimates around 12,000 pigs a week could then be left on farms without contracts or an alternative market.

It warned this could create both an economic and animal welfare problem for producers already operating under severe financial pressure.

One of the association’s main proposals is a pig price top-up scheme for farmers forced onto the spot market.

The NPA wants direct financial support reflecting the difference between the exceptionally low prices some producers are receiving and their costs of production.

It is also calling for a Pig Industry Restructuring Scheme to support businesses that have reduced herd sizes or have no option but to close all or part of their operations.

The association expects more producers could leave the sector as contract notice periods expire.

To manage pigs left without a market, the NPA is proposing a government-funded Private Storage Aid scheme for pigmeat alongside a Slaughter Incentive Payment Scheme.

The measures would be intended to operate until supply tightens, demand improves or pigmeat can be sold into overseas markets.

Alongside immediate financial intervention, the NPA has put forward a series of longer-term proposals aimed at reducing instability in the sector.

These include compulsory market monitoring to improve forecasts of the British breeding herd and piglet numbers.

The association wants powers under the Agriculture Act used to collect the data and argues that any system would need to be compulsory to provide an accurate picture of future supply.

It is also considering an industry code of conduct to complement Fair Dealing Obligations regulations and address concerns over behaviour within the pig supply chain.

The NPA said recent discussions around contracts had highlighted practices that some independent producers consider manipulative and unethical.

Greater transparency in foodservice is another priority.

While retailer support for British pork has remained relatively stable, the association said the out-of-home sector relies more heavily on imported pigmeat and provides less information about country of origin.

It wants government action to improve transparency in foodservice and bring labelling closer to the requirements already seen in retail.

The NPA is also calling for reform of Government Buying Standards to increase the amount of British produce purchased by the public sector.

On trade, it is backing common production standards for domestically produced and imported food, arguing that British animal welfare and sustainability requirements should not be undermined by products produced to lower standards overseas.

NPA chief executive Lizzie Wilson said the industry was facing another period of severe instability only four years after its previous crisis.

“The pig sector is going through another hugely turbulent period, just four years after the last crisis – and we face losing more producers and more of our critical mass, if things continue as they are.”

She pointed to the £2 million pig industry support package announced by the Scottish Government in July as an example of the type of intervention the NPA wants to see in England.

“We are seeking similar support for struggling producers in England, alongside various longer-term measures that will take out some of the unacceptable risk they currently face, improve supply chain behaviour and boost British pork sales.”

Wilson said the proposals were intended to address both the immediate financial pressure and longer-term weaknesses in the market.

“We believe this is a necessary and proportionate set of proposals that would help ensure a sustainable future for our sector – and we urge ministers to give it their full consideration.”

The NPA has also helped bring affected producers together with the Agricultural Supply Chain Adjudicator and Defra officials to discuss the market disruption.

It joined NFU Scotland and the Ulster Farmers’ Union in July in calling for a ministerial-led emergency summit involving the wider supply chain.