Pig sector is still facing up to major market challenges

While the pace of the decline in prices for Scottish pigs might have eased from the autumn peak, new data has highlighted that both producers and processors continue to face severe challenges.

And despite some good news in the shape of last week’s acquisition of Quality Pork Processers Ltd in Brechin by Browns Food Group - which could help alleviate some of the ongoing challenges faced by the sector in Scotland - the latest analysis from Quality Meat Scotland (QMS) has revealed that the downward pressure on the pig market looks set to continue.

Welcoming the takeover, Iain Macdonald, QMS senior economics analyst, said that the acquisition would provide the platform to build a stronger future for the Scottish pig industry – adding that it would also benefit the wider Scottish economy as the pig carcases would be processed at sites in Scotland, supporting employment in Scotland rather than at production sites south of the border.

However he said that on a UK-wide basis, the downwards pressure on the pig market continued to come from an inability of the processing sector to expand output to handle an increased supply of finished pigs.

“This constraint in output has been driven by a lack of suitably skilled workers, with the change in UK immigration rules after EU exit making it harder to recruit from overseas while domestic workers tend to favour careers in other industries, such as warehousing for online retail”, said Macdonald.

He said that in addition, backlog of pigs on-farm meant that they quickly exceeded target weight-ranges, further reducing their per kg value to the producer and processor as heavy carcases and their component cuts had fewer outlets.

Macdonald said that further evidence of market distress and a severe backlog came from an increase in carcase weights since the turn of the year, with average weights now approaching 96kg.

During January Macdonald said that figures had shown that almost 20 per cent of carcases weighed in at 105 kg or over – a figure which compared with closer to 6 per cent the year before, a figure which had in itself been higher than normal due to covid-19 abattoir closures in late-2020.

“One slight positive for producers is that the rise in carcase weights has been offsetting lower per kilo prices, resulting in higher average prices per carcase.”

However rising input prices had bitten into any increase, with the small reductions in the price of wheat and soya last autumn being reversed over the winter – with prices for wheat and soya rising by about 15 per cent while that of barley had risen by closer to 25%.

Meanwhile, at the bull sales, Aberdeen Angus prices held up with a top price of 38,000gns being paid for a bull from Neil Massie and Sons’ Blelack herd. Second top of the day was 30,000 gns paid for a bull from A Clark and Sons’ Duncanziemer herd from Cumnock, while eight other bulls made five-figure prices.

Shorthorns topped at 25,000 gns for a bull from G Turton’s Upsall herd.