Current pig prices are just covering costs with many pig farmers struggling financially facing into 2017, according to the IFA Pigs Committee Chairman, Tom Hogan.
“Producers have experienced one of the worst price crises in decades and it will take a long period of strong margins to recoup loses of the past two years.
“While prices are currently covering costs, the losses sustained in both 2015 and 2016 have left many pig farmers in a very poor financial situation heading into 2017.
Without a strong rising pig price and stable feed price, pig production in Ireland will have to examine where it is going.
Farmers are expecting the pig price to increase substantially over the coming days, Hogan said.
He has called on processors to reflect improvements in trade with increased producer prices this week.
“A number of factors provide justification for a price increase, including a strong export trade, tightening supplies and a steady demand for Irish product on the domestic market.
“While quotes have remained relatively static at the €1.60/kg level for the past number of weeks, it is clear that prices well in excess of this level are being secured for both spot loads and long term consignments of pigs from large scale producers,” he said.
Hogan warned processors that the price paid to smaller producers cannot be used to subsidise a small number of deals for larger pig producers.
Irish Pigmeat Exports
Irish pigmeat exports saw growth in both 2015 and 2016, with the Chinese market seeing the greatest increase, according to the IFA.
The IFA believes that China will remain a significant player in the importation of Irish pigmeat in 2017, especially with domestic Chinese pig supply likely to remain tight for the coming year.
Meanwhile, the demand for offal over the past 18 months has shown modest growth with consumers in this market willing to spend more on food items, in particular for pork, where food safety and animal welfare are highly regarded.
All indications point toward further opportunities for Irish exporters into this market, Hogan said.
It is crucial that any gains achieved from increased exports to markets such as China are fairly reflected in producer prices, the IFA Pigs Committee Chairman said.
We have ambitious Food Wise 2025 targets, which we want to achieve.
“The pig sector is the first industry to achieve its targets under Food Harvest 2020 and we want to see the third largest agricultural sector in Ireland in a healthy position by the end of 2017.
“It is only with a strong pig price that this will happen.”