Buoyant pig market and impact on producers
As of 2018, there has been a positive outlook as far as the pig production is concerned. Having reached towards the end of 2018, let us quickly recapitulate what it was like for pig supply chain and the market in the year that has few days to bid good bye.
The pig market particularly in the United Kingdom has been robust and has enjoyed a period of stability, however, that does not necessarily mean that there are no challenges facing the market in the days to come. There are challenges that have to be overcome with the appropriate measures.
It has been observed that the last couple of months have seen the industry in a fairly stabilized position and the cost of production recorded was approximately 140p/kg. One of the main attributable factors is that the approximately 1/3rd of pig meat in the UK is exported and the competitiveness that is prevailing in the export sector.
Studies have revealed that over the last one year, a growth of 0.5 pigs reared a sow per year. This simply implies that the higher number of sow a year, the supply of pig meat has also increased by average 1% to 2%, not just in UK but throughout Europe and it is being anticipated that this figure might go up by another 2% to 3% in the forthcoming year. If this figure is achieved, the number will escalate to more than 10.5 million pigs as far as the production in UK is concerned.
Another factor that has contributed immensely to the growth of the pig market in UK is European prices.
Having said about the prevailing and forthcoming scenarios in the pig market in EU and UK, there is also a political reason for the pig producers to pin their hopes pertaining to pig supplies. And this is the trade war that is setting pace between the United States and China.
So, how will the trade war impact pig production and supplies in UK and Europe? The US government has enforced certain barriers in trade pertaining to Chinese imports. To this step, China has levied a tariff of 25% on several agricultural products. And among these products pork is also included.
And with this China may migrate from one supplier to another thereby facilitating or making way for United Kingdom to gain more access to the market share. Not only this, such a step may as well allow EU prices to stop from oscillating.
The immediate threat to pig industry
Having said the positive side of the pig meat industry and production, there is a threat that has to be ward off if the current beneficial scenario has to be sustained and kept consistent. And this is essentially the virulent pig disease that experts say can get closer to Germany. In fact, studies have revealed that the virus has already been found in eastern parts of Europe. And Germany is definitely the largest producer of pig meat.
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