Teagasc has told the National Fodder and Food Security Committee that the Irish pig sector has lost €81 million so far this year.
The fourth meeting of the committee heard that the average 600-sow unit has lost an estimated €336,000 to date in 2022.
The losses are being mainly driven by significant increases in the cost of pig feed while prices paid to producers fail to keep pace.
Pig feed costs jumped by €76/tonne between April and May – the current composite price of €476/tonne has risen by 40% year-on-year.
Although pig price has increased by 51c/kg since January, the rise has been negated by feed costs.
However, the committee was told that feed price has stabilised and may decrease slightly.
It is expected that pig price will continue to rise towards the end of the year and early 2023 as supplies tighten due to herd culling.
In the past year, European sow numbers have fallen by around 500,000.
Teagasc noted that the current pig price of €1.94c/kg is 26c/kg below the break-even threshold.
Unsurprisingly, the meeting heard that the €13 million Pig Exceptional Payment Scheme (PEPS), which closed for applications on Monday (July 11), has been oversubscribed.
The agency estimated the average scheme payment for producers will be €82,000, which it described as “a huge benefit”.
Poultry
In its update on the poultry sector, Teagasc noted that feed prices for turkeys were up by 37% compared to July 2021, while meat prices have only increased by 16%.
Turkey producers are also facing higher costs for energy and the disposal of litter and manure.
Compared to January 2021, the cost of feed for broilers has jumped by around 60%, transport and packaging is up by 25-30%. Non-feed costs, including electricity, have increased by 60%compared to last year.
Teagasc said that producers had sought a market price increase of 15c/bird but this has not materialised, leading to producers cutting back on numbers.
Free range feed prices for layers are up by a fifth on April 2021.
Organic feed has seen prices spike by as much as 74% to around €915/t which Teagasc warned was not sustainable. As a result, organic egg producers are not restocking.
Chair of the National Fodder and Food Security Committee, Mike Magan noted that the poultry sector reacts very quickly to market trends.
“I think it is very important that we keep supporting this sector because they will get out of business quicker than anybody else because they won’t just stay losing money,” he said.