The Agricultural Supply Chain Adjudicator (ASCA) and his team have heard how the current pig market turmoil is damaging pig farms up and down the country at a roundtable event organised by the NPA.
Last week’s event, also attended by Defra officials, featured eight independent pig producers who had all been given notice on a least a proportion of their pigs by their processor. One has already made the decision to get out of pigs altogether, while others are reducing their herd sizes in response to the contract cuts.
It is estimated that, when the contract notices start to kick in from October, an extra 10,000 to 15,000 pigs could be on the market without a contracted destination to go to.
Some producers highlighted how they are already receiving some extremely low prices, way below the industry averages quoted each week, and revealed how they face heavy financial losses as a result of this and the contract cuts.
Richard Thompson was appointed as the ASCA to oversee the Fair Dealing Obligations (FDO) regulations that currently apply to the dairy and pigs supply chains and are being developed for other sectors.
The roundtable also highlighted numerous concerns over how new pig contracts have been formulated and negotiated over the summer, in order to comply with the FDOP regulations, which came fully into force on August 13.
In some cases, the contracts being offered were convoluted and unappealing to the producers, who felt, however, that they had nowhere else to go in the current marketplace. Producers also spoke of the length of time it had taken to get sight of their contracts, how long the process was taking and of poor communications from processors.
Valuable exercise
NPA chief executive Lizzie Wilson said: “This was a hugely valuable exercise that enabled independent producers to voice their concerns directly to the ASCA, who has been clear all along that he wants to engage directly with people on the frontline.
“What was discussed was deeply concerning, as producers highlighted the impact on them and their businesses of the turmoil we are seeing in the marketplace, and, in some cases, the way contract negotiations have been handled.
“The adjudicator and his office were left in no doubt about the seriousness of the situation facing independent pig producers – and we hope this feedback will be useful as we seek some much-needed support for the sector.”
The roundtable discussion echoed the findings from an NPA survey that highlights the problems producers are facing.