A “perfect storm” of Covid-19 abattoir shutdowns and Brexit trade disruption has resulted in a 14% drop in farm-gate pig prices, claims Quality Meat Scotland (QMS).
The levy body’s senior economic analyst Iain Macdonald said pig producers are feeling a considerable squeeze on their margins.
QMS data shows the GB standard pig price (SPP) was just below 140p per kg in the first week of February. This is 14% lower than the same week in 2020 and 1.5% below the five-year average.
“A major driver of this sharp downturn in prices has been Covid-19 outbreaks at a number of pork-processing sites across the UK in the second half of 2020 and the start of 2021,” said Mr Macdonald.
“These outbreaks have led to temporary closure or reduced operations. Coming at a time when a significant year-on-year increase in pig availability had been anticipated, this has resulted in a large backlog of pigs on farms.”
He said the American abattoir closures in spring last year, due to Covid-19 outbreaks, showed that even if there is strong consumer demand for pork, if the pigs cannot be processed then reduced competition for them places a downwards pressure on their price.
Farmers attending NFU Scotland’s virtual annual conference on Friday said estimates suggest up to 15,000 pigs are being held on Scottish farms waiting for slaughter.
Rural Economy Secretary Fergus Ewing said the Scottish Government was monitoring the situation.