Union: Prices of pork producers are at their maximum, demand is greater than supply

Union: Prices of pork producers are at their maximum, demand is greater than supply

Union: Prices of pork producers are at their maximum, demand is strong

Pig breeding – illustrative photo.

Prague – The prices of pork producers are at their highest ever. At the same time, breeding numbers are falling, there is a greater demand for pork on the market than farmers and processors are able to offer. Radek Slanec, executive director of the Czech Association of Meat Processors, told journalists today. Together with the president of the Food Chamber of the Czech Republic, Dana Večeřová, they drew attention to the fact that food companies cannot reflect the increase in costs into the prices of their products. According to the chamber, their costs increased by 50 to 80 percent last year.

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Večeřová also stated today that there is currently no scope for reducing food prices due to the ever-increasing costs of manufacturing and processing enterprises. Slanec said that from December 2021 to December 2022, the number of pigs in the EU fell by 5.8 percent to 125.5 million. Most in the Czech Republic, Denmark and Lithuania, and significantly also in Germany.

According to the Czech Statistical Office (ČSÚ), last year meat production in the Czech Republic fell by 4.2 percent to 447,317 tons, i.e. to roughly the same level as in 2018. The number of pigs fell by 11 percent to 1.329 million pigs. The CZSO stated that in the last quarter of last year the prices of slaughter pigs rose by 49.8 percent.

Slanec said today that pork prices have been rising since last February, after energy prices began to rise significantly. They fell slightly only after energy prices were capped. According to him, in the last three weeks there has been another sharp growth and at the moment no one knows where the growth will stop. “We are reaching the highest prices ever achieved in this commodity,” he said.

He pointed out that pork makes up about 47 percent of the average meat consumption in the Czech Republic. According to the CZSO, in 2021 the average consumption of pork was 43.4 kilograms per person. He said that according to an investigation by the State Agricultural Intervention Fund (SZIF), the price of suppliers of meat products for shops increased by 19.4 percent from 2019 to 2022. For beef, this is an increase of 25 percent to CZK 146.39 per kilogram. The price of pork rose by 10.4 percent to 71.72 CZK per kilogram.

Slanec said that the increase in energy prices and other costs could not be transferred to the increase in producer prices. “For pig farming, 92 percent of the price is the cost of feed and energy,” he said.

Currently, according to him, slaughterhouses are already selling pork to the highest bidder, so the goods will be given to whoever pays the most. “There is a greater demand for pork on the market than the processing industry and farmers are able to offer,” he added. According to him, there is also great uncertainty regarding the future development of energy prices, and high inflation is also putting pressure on wage growth. He stated that the market is already experiencing the fact that some companies are limiting production or stopping it outright, and major manufacturers are closing their own stores.

Slanec also pointed out that the costs of manufacturers will continue to rise due to a number of measures that introduces the Green Deal for Europe. He mentioned, for example, the requirements for significantly more expensive ecological packaging. Costs also increase due to product labeling.