Page 8 - Australian Pork Newspaper

Tough times for pork producers but PQI here to help
PRODUCERS are ex- periencing one of the toughest periods of pig farming in the past 20 years, with many sell- ing pigs well under the cost of production.
At a recent Queensland Pig Consultancy Group industry seminar held in Toowoomba, one of the presenters outlined the losses many of his cli- ents were facing.
He estimated losses across a range of pro- ducers of $20 to $30 per pig sold.
This trend started in the usual fall in prices post-Christmas and has continued through to date.
Many producers con- cerned with this position have elected to stop or reduce matings in an attempt to minimise losses and hold on until a recovery brings prices
back to sustainable prof- itability.
The hindsight of trends shows a low in the seven- year supply and demand cycle is where the indus- try sits at present but the question on everyone’s minds is when will the recovery come?
Typically, these lulls have lasted six to 12 months, however this time a number of additional factors are at play includ- ing the increase in herd performance, high grain cost and increased mat- ings when prices looked
good with the prospect of increased sales.
Profit along the pig chain is not fully real- ised until the pig meat from a carcass is sold!
Imported pork has been with the domestic trade since the late ‘90s, but of late we have seen the introduction of new cuts, adding to the com- plexity of utilising and gaining best value for all cuts of our pigs.
Marketing and promo- tion of Australian pork has helped balance the import conundrum but
until we can sell all the cuts at a price that allows us to live with imports and reach a sustain- able price for pig farm- ing, which is balanced against supply and de- mand, then we will see producers suffer within the terms of industry ra- tionalisation.
I have always been a firm believer in mar- keting our product into export markets and still believe this is where our industry must look to better balance our sup- ply and demand model – which is not about pigs but more about the cuts from pigs!
So, what to do while we wait for the balance to return?
Many industry players are saying it may take 12 to 18 months to reach a sustainable position.
Everyone’s position
will be different, howev- er if your future is look- ing grim and you need to consider support financ- ing, acting sooner rather than later was advised by the managers from Queensland Rural and Industry Development Authority at the recent industry meeting.
Producers who are in- terested in the support offered to analyse their debt position and pro- vide guidance and sup- port in accessing refi- nancing options should make contact with the authority.
Call 1800 623 946 for assistance.
Pork Queensland Inc has provided ministers and department heads in Queensland a clear picture of the extreme position the Queensland pork industry faces if the situation continues.
President’s Perspective
by JOHN COWARD
Pork CRC CEO Dr Roger Campbell made a point at the 2018 Pig Day Out about how Australian pork producers fared in 2016 in terms of productivity when compared with the US, Canada, Denmark, Netherlands and Britain.
Weighing up pork production priorities
ADDRESSING pork producers in Western Australia recently at WAPPA’s annual Pig Day Out, Pork CRC CEO Roger Campbell said in- creasing carcass weight was perhaps the greatest opportunity for produc- tivity improvement for Australian pork produc- ers, albeit at a time when many were struggling as prices declined due to apparent oversupply.
Dr Campbell suggested that if a business mod- el was developed where $2.70/kg could sustain producers, he was opti- mistic producers would have a positive future.
“Also, if buyers, in- cluding supermarkets, processors and others in the meat chain could cre- ate markets for heavier pigs, producers would re- spond positively and reap rewards,” Dr Campbell said.
“Even grain prices, which are largely beyond a producer’s control and which have the heaviest impact on the bottom line, can be mitigated if, for example, other factors af- fecting cost of production can be better aligned.
“While it’s difficult to do much about grain and feed costs, except use the feed more efficiently, the greatest opportunity for reducing COP lies in volume and this is inde-
pendent of grain price and hence more under produc- er control.
“Busting the $2.50 COP barrier and getting that down to, say, $2.30, would help.”
Dr Campbell had re- cently noted quite large increases in born alive and this too would help improve productivity, volume and, potentially, profitability.
“In Pork CRC’s bench- marking group we’re see- ing consistent improve- ments in sow productivity, with better herds weaning 11 piglets per litter and 26 per sow, per year,” he said.
“If we get our average to this, we will take nearly 20 cents off other costs, independent of feed cost or carcass weight and if we get carcass weight up 5kg, we could reduce oth- er costs by another eight to 10 cents.
“Global competitive- ness is within our reach, but 2018 is likely to be volatile for the global pork industry.”
Australian producers were not alone in receiv- ing less for their pork, with EU prices down 7.6 percent on 2017; US down 22 percent in the past month; China down 23 percent in the past five weeks and UK down 2.5 percent on 2017.
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Stockyard welcomes Joe Oliveira to the team
STOCKYARD Indus- tries is pleased to wel- come Joe Oliveira to the sales team.
Joe has more than 14 years of sales experience and technical support in the agricultural industry for climate control in pig and poultry.
Joe has been involved with Munters in South Africa and has extensive experience in design of ventilation, heating and cooling for the agricultur-
al sector along with pro- ject management.
Joe will be based in Queensland at Stock- yard’s head office and can be contacted on 0437 322 446 or joe@stockyardin dustries.com
Joe is passionate about customer service and re- lationships and looks for- ward to meeting Stock- yard’s customers at the Pan Pacific Pork Expo to discuss any equipment needs.
Page 8 – Australian Pork Newspaper, May 2018
www.porknews.com.au
Joe Oliveira