Pig cycle at an end but sector warns fodder supply issues could kick in

GENERATIONS of agricultural students have been taught about the "pig cycle" – periods of high profitability followed by the sector making big losses.

But Francis Mordaunt, of farm business consultants Andersons, has questioned whether the roller-coaster still exists, as the sector enjoys a period of prolonged profitability, though with only half the pigs of a decade ago.

Philip Sleigh, Netherton of Mounie, Oldmeldrum, chairman of the NFU Scotland's pigs and poultry committee, said: "Ten years ago, there were speculators but now we see a solid industry with demand for what we produce."

There has been a tightening of supplies and the "spot" price is currently on the same level as the contracted price. "That tells us there is a demand for pig meat, with buyers wanting more than they have contracted," he added.

Gordon McKen, managing director of Scottish Pig Producers, said pig numbers were falling in Europe, with countries such as Poland now a net importer of pork rather than an export rival.

Although the latest Scottish census figures showed a rise in the numbers of gilts retained for breeding, Sleigh said he was not concerned about that. Most producers were not planning any major increase in numbers.

The industry was in better condition than it had been for a long time, he said, either through increased profitability or via the Scottish Rural Development Programme, where there has been a considerable investment in buildings, especially in slurry stores.

"This will help us through any future dip in demand," he said.

Sleigh acknowledged the exchange rate had worked in favour of the industry, making imported pork more expensive, though the UK remains a net importer.

The poor cereal price may be troubling the grain grower but the pig and poultry sectors, both major users, are benefiting.

However, Sleigh said one cloud on the horizon was the price of soya, the main protein in fodder. It is imported, has been hit by the GM debate in Europe, and its price will rise if the pound weakens further.

He said: "We are afraid that the EU might take a totally GM-free approach to a point where when even the dust on the roof of a store is found to have GM organisms, the boatload may be rejected.

"What we are arguing for is a workable tolerance similar to that used by supermarkets when they can claim 'GM free' on products even if a trace can be found."

On the sales side, McKen said the launch last year at the Royal Highland Show of Scottish pig meat endorsed by the Scottish SPCA had been very successful. Also the support from Asda for Scottish pig meat had made a big difference in sales.

He hoped other major retailers would come on board and that customers would ask for the assurance on animal welfare that the Scottish SPCA label provided.