Inside Pigs
That's how high the cost of pork production
The costs of pork production in the European Union in 2019 have remained almost the same as the year before. This is according to a report by AHDB Pork. The Netherlands, Hungary and France are the biggest spoilsports and note a clearly higher cost price. The long-term European trend goes along with this and is therefore showing an increase. In the United States, too, the costs of pork production have risen sharply in recent years.
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Every year, government agency AHDB outlines the costs of pork production in the report 'The Pig Cos of Production in Selected Countries'. It is a report that many in the sector are looking forward to. Now that the figures for 2019 have been updated, it is clear that the costs of pork production in the European Union have remained approximately the same compared to the previous year. The costs in the above-mentioned year were €1,62 per kilo, compared to €1,63 per kilo a year earlier. Compared to previous years, costs have increased, as in 2016 they amounted to €1,58 per kilo.
According to AHDB chief analyst Carol Davis, the figures show that European pig prices were relatively strong in 2019 compared to a year earlier. “As total production costs fell overall, this resulted in positive margins in almost all countries. Sustained demand kept pig prices and margins strong in 2020, but with falling pig prices and rising feed costs this is likely to have led to negative margins in the last quarter."
Dutch cost price is increasing
The Netherlands is one of the few countries in the European Union where production costs increased in 2019. That year the costs amounted to €1,59 per kilo. That is an increase of 2% compared to the year before. High feed costs, due to the impact of the drought on grain harvests, have played a role in this. Since 2014, pork production costs have fallen by €0,05 per kilo. Calendar year 2016 stands out, because in that year production costs worldwide skyrocketed. In the Netherlands this resulted in an amount of €1,58 per kilo.
The costs of pork production have also increased in France and Hungary. In Hungary, an increase of 2019% to €3 per kilo is visible in 1,68. In France, production costs increased by about 2% that year, to an amount of €1,54 per kilo. The increase in these countries is also mainly caused by higher feed costs. It is striking that production costs in both countries have been declining for years in a row. In France, about 2014% have been lost since 5,5 and in Hungary a decrease of almost 12% is visible.
On the other hand, Belgium is at the other extreme. In that country, production costs fell by no less than 2019% in 6 to €1,38 per kilo. Even if we look at previous years, the costs of pork production in this country are slightly lower than the average in the European Union. For example, in the standout year of 2016, production costs here amounted to €1,43 per kilo, compared to the European Union's €1,58.
Significant increase in the United States
Increases are also visible outside the European Union. For example, pork production costs in the United States rose by as much as 8% to €1,08 per kilo. In Brazil, costs increased by 3% to €0,99 per kilo. It is clear that the costs of pork production outside the European Union are considerably lower. In Canada, the average price is €1,06 per kilo, a decrease of 9% compared to the previous year. While the costs of feed in the European Union actually rose in various countries, they fell outside the European Union. In Canada, for example, by 13%, compared to a year earlier.