Pig group warns over wheat price

The British Pig Executive said its industry could be back to losing money on every pig by the end of the year.

At the price levels holding at the beginning of this week, BPEX said, the cost of English pig production would rise from 137.2p per kg in June 2010 to 146.35p per kg in November 2010.

However, all European producers would be in the same boat. And Jack Watts, a market analyst with the Home Grown Cereals Authority, said the Russian ban on grain exports meant "the current situation is different to that of 07/08, when wheat stocks were critically low.

"Now, wheat stocks are at comfortable levels, with the main drivers being political rather than supply and demand."

He said: "The northern hemisphere harvest is still under way and the market should be less volatile once it is complete and production levels known.

"Around the world, demand for wheat as a feed grain is likely to decline as it has become uncompetitive against other materials such as maize, to some extent barley, and by-products from the ethanol sector.

"Much has been said of the influence of fund speculation in the current rally, but there is little evidence to suggest that this is a significant driver.

"The near future is expected to remain uncertain and volatile as the world waits to see final production levels and any further political decisions from the FSU (former Soviet Union)."

Adam Bedford, food and farming adviser for the regional NFU, commented: "Volatility in the price of wheat has an impact on all livestock sectors.

"The poultry industry is particularly sensitive as approximately 60 per cent of the cost of growing a chicken or producing a dozen eggs is down to the cost of feed, and this is 60-65 per cent wheat."

Dairy farmers were also in the front line, he said.

n At the same time, EBLEX, the BPEX equivalent for beef and lamb, issued a warning that a bad year for grass had led to "increasing numbers of under-finished cattle coming forward for slaughter".

It said: "Selling under-finished cattle is a wasted opportunity. Not only are producers losing out on carcase weight and price, but killing-out percentage will also be lower in underfed cattle grazed on poor grass pastures.

"Bringing cattle inside to finish is an option – expensive, however.

"Producers should consider providing supplementary feed for grazing cattle.

"Finishing continental-cross steers and heifers off grass will require supplementary feed at a rate of 0.5-1kg of concentrates per 100kg live weight where sward heights are below 7cm.

"In the case of finishing cattle, grazing could simply be supplemented with rolled barley, as they do not have a high protein requirement at this stage.

"Advice is available in Beef BRP Manual 7 from www.eblex.org.uk."

CW 14/8/10