The cost of producing pigs is set to rise even further, with the impact of further feed prices hikes potentially adding another 20p/kg to already sky-high costs, according to AHDB.
AHDB recently estimated that average cost of production for pig was currently in the region of 203-216p/kg, up from 193p/kg in Q4 due to rising feed and energy costs. With prices at the time around 150p/kg, this equated to average losses of up £61/pig.
While pig prices have risen since then – the latest SPP was just short of 165p/kg – so have costs. “Energy and feed ingredient prices continue to rise and whilst pig prices have also significantly increased, the SPP and APP reported prices have failed to keep pace with the impact of these increasing input costs,” AHDB analyst Carol Davis said.
“Our article earlier in the month stated that we estimated that the current full economic cost of pork production was in the region of 203p/kg to 216p/kg. As feed ingredient prices and compound feed prices start to trickle through, indications are that feed price increases alone are likely to add another 20p/kg onto the cost of producing a kg of pork.”
AHDB’s next quarterly cost of production estimation for 2022 Q1 will be published after the receipt of the quarterly AgroVision pig performance information, which is due in the second week of May.
The cost estimations include the cost of producing a kg of pork from conception to slaughter and therefore take account of various performance aspects such as litters per sow per year; piglets born per litter; sow and piglet mortality; daily liveweight gain and feed conversion ratio (FCR).
The estimations do not include any allowance for profit margin or owner or director management time or reward. The only labour hours and cost included are for the time spent looking after sows and piglets on a day-to-day basis.