British Pig Executive
15/11/2006
UK - Feed prices are rising and producers coming off contracts could be facing on average an extra £12 a tonne to renew. That equates to as much as 4p per kg dwt according to a feed cost report just published by the British Pig Executive (BPEX).
There is a whole range of factors driving the price increases for cereals, including the drought affecting EU production, low cereal stock levels, fears about new importers and the rise in interest in biofuels. In the UK for example, a biofuel plant is under construction which will take 750,000 tonnes of wheat a year.
Report author Tony Fowler, BPEX Senior Economic Analyst said: "Biofuels, are being promoted by governments around the world as a sustainable energy source. The downside of this is that as they compete with animals and humans for feed, prices will be driven up. Prices are set to show some further rises through the remainder of the current season, which will push up pig production costs.
"But more plentiful EU supplies combined with adequate sources in the Ukraine and North America and lower soya prices should mean that prices are unlikely to approach the high levels of 2003/04. However continuing uncertainty over the southern hemisphere harvests is likely to lead to some volatility in cereal prices over the next few months."
BPEX KT Manager Richard Bull said: "There are actions that can be taken on farm to offset the increase. Ensure the most appropriate rations are being fed to balance costs, growth, feed efficiency and grading. Minimise feed wastage - it is said 5% is invisible! Give a maintenance check to all troughs, check slaughter returns and try to minimise under and overweight pigs. The incremental improvements this will deliver will begin to offset increased cost of the feed."
The report is available as a pdf to download from the BPEX website, www.bpex.org.uk and the site will also include a feed cost calculator. If a producer inputs the amount cereal costs have increased, it will calculate the impact in p/kg/dwt.
