Hedging risks becomes possible
Vion revamps delivery and pricing system
Pig farmers who supply to Vion will soon have something to choose from. In order to better respond to various sales markets, Vion is introducing new delivery modules in which, among other things, fat thickness and weight may vary. The meat company from Boxtel is also introducing new pricing systems.
According to Vion, there are interesting sub-markets on the world market for selling different types of quality pork, both within Europe and in Asian countries such as Japan and South Korea. 'Better gearing our production to the needs of these sub-markets offers new perspectives; both for Vion and for Dutch pig farming', says Frans Stortelder, COO of Vion Pork.
In order to respond to this demand, a wider spread in pigs is desirable. From that point of view, Vion is introducing three new delivery modules. In addition to the 'basic' module, the slaughterhouse is introducing the 'broad' and 'robust' modules. 'Good Farming Balance' is the keyword behind this new demand-driven approach.
The 'wide' module means that more spread in weight and back fat is possible when the pigs are delivered. For example, the option is offered to deliver pigs from a barn in one go. The aim of the 'robust' module is to get fattier pigs in particular, with extra back fat, into the slaughterhouse. There are specific requirements for each module, including delivery weight and back fat thickness, so pig farmers are given the opportunity to choose according to their wishes.
In addition to the delivery modules, Vion is also introducing new pricing systems. In addition to the current weekly price, two new purchasing methods are offered under the names of the Vion Price Index Guarantee (PIG) and the Vion Long-Term Price (LTP). The 'index guarantee' is a price composed on the basis of a number of international quotations, thus guaranteeing an average price. The 'long-term price' is offered to provide pig farmers with more certainty. A combination of the pricing systems is also possible.
The Good Farming Balance is part of Vion Pork's Good-Farming strategy. 'This approach gives the pig farmer much more choice. In this way, both the suppliers and Vion can better cover their risks', says Stortelder.
Wouter Job
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