AHDB is forecasting only very limited recovery in both pork production and pig breeding numbers in 2024, despite much more favourable market conditions, as producers remain very cautious about expanding their herds.
Its 2024 Pork Outlook predicts that pork production will grow by less than 1% this year, following an 11% year-on-year contraction in 2023, as clean pig slaughter fell to its lowest number in a decade on the back of the dramatic contraction in the breeding herd in 2022.
The pig industry returned to profitability over the last nine months of 2023, on the back of falling costs and rising prices, peaking at close to 216p/kg in August, with AHDB estimating average net margins over Q2, Q3 and Q4 of £22/pig, £25/pig and £19/pig respectively. This followed 10 successive quarters of negative margins, at the peak in excess of £50/pig, during which the industry is estimated to have lost more than £750 million.
Although the cost of key inputs, such as feed and fuel has eased, inflation has remained historically high and higher interest rates are likely to be negatively impacting working capital, AHDB noted.
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