Survey highlights huge gap between best and worst performing pig farms

New figures published this week have highlighted the huge gap between the best and worst performing pig farms.

The average pig farm income in England was £21,600 in 2015/16 but this masked massive variation, according to the Farm Business Survey, which has released its annual Pig Production in England report.

Farms in the top 25% performance category earned an average of £122,200 in 2015/16, compared with an average loss of £59,800 in the worst performing category, meaning the gap between the best and worst performers was around £180,000. However, the gap is closing and actually fell by £30,500, a drop of 14% on the previous year, according to the report.

The middle 50% recorded average incomes of £10,600.

Producers across the performance categories battled with falling pig prices and rising costs last year, as incomes fell by an average of 56% in 2016, with some of the top performing farm businesses being hit hardest.

These saw turnover from pig sales drop by 37%, while pig output from the lower performance groups actually increased.

Despite the falling prices, pig numbers rose by over 2% last year toto 3.9 million animals, mainly driven by a 2.4% increase in fattening pigs, while the female breeding herd showed an increase of 1.8% from 2015.

Rachel Lawrence from the Farm Business Survey said: “The falling pig price in 2016 hit those farms selling direct into the market hardest. The impact would actually have been more severe, if many businesses hadn’t increased throughput through the year. .”

Unusually, the incomes for contract rearing/finishing businesses were actually higher than that of breeding units in 2016, a scenario not seen in the industry for a number of years. Herds that are predominantly breeding units felt the full impact of falling pig prices, as turnover from pigs fell by 13%. Contract rearers saw management fees remain relatively stable despite significant increases to the wages bill.

The bill for wages and salaries totalled 12% of pig farm output in 2016/17, an increase of 26% on the previous year. Ms Lawrence said labour was becoming an increasingly significant cost to pig farms.

Pig producers continued to increase farm income from diversification, the survey showed. Last year, 9% of output on pig farms was from diversified activities, a 4% increase on the previous year, and 2% higher than the average farm business.

The data also showed the total number of specialist pig holdings in England reduced by 11.5% in 2015 with all regions except Eastern showing a reduction. Overall Yorkshire and the Humber account for 37.2% of the total pigs in England with the Eastern region accounting for a further 28.2%.

About the Farm Business Survey

  • The Farm Business Survey, which can be downloaded here, provides information on the physical and economic performance of farm businesses in England. Established in 1936, it collects financial performance information from over 1900 farms across England.
  • It is carried out by Rural Business Research (RBR), a group of researchers from the Universities of Cambridge, Newcastle-Upon-Tyne, Nottingham, Reading, Askham Bryan and Duchy College.
  • The minimum size threshold for farms in the FBS is a €25,000 Euro standard output under ‘normal’ conditions. Specialist pig farms are farms on which pigs account for more than two thirds of standard output.
  • There were 68 businesses classified as specialist pig farms in the Farm Business Survey 2015/16.

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About The Author

Editor of LBM titles Pig World and Farm Business and group editor of Agronomist and Arable Farmer. National Pig Association's webmaster. Previously political editor at Farmers Guardian for many years and also worked Farmers Weekly. Occasional farming media pundit. Brought up on a Leicestershire farm, now work from a shed in the garden in Oxfordshire. Big fan of Leicester City and Leicester Tigers. Occasional cricketer.