Pig production costs confirm widespread losses

Average pig production costs per kilogram of carcass in the first six months of 2009 continued to be lower in Brazil, Canada and the U.S. than for the member states of the European Union, according to InterPig costings presented to a meeting of the European Pig Producers organization.
Costs were lower in Denmark, Spain, France and the Netherlands than in the UK, Ireland and Germany. However, calculations shown by the council's 2009 annual report suggest that producers in all of the countries made losses in the January to June period as feed costs were restored only slowly to lower levels after the high grain prices of 2008.
In Denmark it meant a production cost of slightly over US$2 per kilogram, leaving a negative margin of about 40 cents. For Germany it gave an average loss of about 44 cents from a production cost of approximately $2.43. The same rate of loss per kilogram was calculated for Canada due to low pig prices, even though the Canadian production cost was lower at around US$1.64.
Danish prices just about covered costs in the third quarter of the year, says Finn Udesen at the agriculture/food council, before margins slipped into the minus zone again in the final three months. On balance, therefore, there had been some improvement in profitability in the second six months of 2009.