Government measures aimed at stopping thousands of pigs from being culled came too late and risked a “catastrophic collapse” in pig prices that would put British farmers out of business, an industry association warned.
The National Pig Association said thousands more farm animals are likely to be killed, despite the fact that an emergency visa was introduced last month to take in 800 foreign butchers. The butchers are now unlikely to be at work until January.
According to the NPA, more than 14,000 pigs are said to have been killed due to an acute shortage of skilled workers in Great Britain after Brexit.
The shortage has forced desperate farmers to sell pork well below its normal market value, figures from the NPA show. Pig farmers are under further pressure from rising energy and food costs.
A key industry benchmark known as the Standard Pig Price (SPP) is expected to drop to as low as £ 1.14 per kg – well below the average cost of production of £ 1.80 per kg.
The market is also being flooded with cheap meat from Germany, which has lost its main export market, China, which is closed due to African swine flu outbreaks.
Farmers are now hoping that they can “hold out” and stay in business until spring if they hope the pig price will recover.
Many pig farmers are currently in an “extremely precarious” position, said Lizzie Wilson of the NPA.
“Processors who try to remove part of the residue on the farms offer to take so-called ’emergency loads’. This means that farmers who are dying to get rid of some pigs can send them in and they will only be paid, let’s say 70p a kilo per pig.
“That is then fed into our pricing mechanism and brings the average pig price down.
“There is no sign of improvement,” said Ms. Wilson. “Production costs won’t go down that quickly and the price of pork just keeps dropping.
“Some processors tell us they won’t start reducing the backlog until the spring, so there’s no real breathing space. We just hope that the majority of farmers can hold out. “
According to the NPA, farmers lost an average of £ 25 per person in the first six months of 2021, making a total loss of £ 130 million for the industry. The second half of the year should be at least as bad.
The industry has already shrunk dramatically this year, with the number of breeding sows falling by 27,500 or 8 percent of the total number before Covid.
NPA chairman Rob Mutimer has written to Environment Secretary George Eustice warning that the emergency measures he is taking could further harm struggling producers by causing a “catastrophic collapse” in pig prices.
Mr Eustice pledged to fund a program to store partially slaughtered pigs to encourage slaughterhouses to start processing meat and reduce backlog on farms.
But the system has changed since its announcement and will now pay for the storage of fully processed cuts of meat. Pig farmers say this means meat processors are not immediately taking advantage of the government-funded program.
It might not solve the immediate problem of a pig residue on farms as slaughterhouses plan to wait and use storage space next year to smooth out supplies, the NPA said.
Rather than partially processing thousands of animals now, they are waiting for butchers to arrive in the UK on temporary visas in January when they plan to fill subsidized warehouses with fully processed cuts of meat.
“This will allow them to use the resource to boning the product and store it until summer 2022, when supply is expected to decline,” Mutimer said.
It came when poultry farmers warned that their industry in the UK would shrink by about 15 percent unless the government agrees to allow thousands of temporary workers from abroad each year.
A one-time, temporary program for up to 5,500 poultry workers was hailed this week as key to ensuring that UK farms can deliver enough turkeys for Christmas. But farmers say they cannot plan for the future if the program is not permanently available.
Fruit, vegetable and flower growers have all said that they are already cutting production for next year because they cannot be sure that they have enough workers to harvest their crops.
The National Farmers’ Union (NFU) said it was forced to ditch an “unprecedented” amount of crops this year due to staff shortages.