The accuracy of Britain’s deadweight pig pricing system has been thrown into doubt after the withdrawal of two of the country’s main processors from it.
The Karro Foods and the Cranswick Country Food plants at Preston and Watton slaughter tens of thousands of pigs a week between them.
It means the voluntary deadweight average pig price (Dapp) calculated weekly by English pig levy board Bpex – and used across the UK – will now be based only on rates paid by processors H.G. Blake, Cheale Meats, F.A. Gill, Tulip, Dunbia, Woodhead Bros and Lamberts.
NFU Scotland pigs committee chairman Philip Sleigh, of Netherton of Mounie, Oldmeldrum, said the news was disappointing.
Gordon McKen, managing director of Huntly-based marketing co-operative Scottish Pig Producers, feared the accuracy of Dapp would become less representative of the marketplace.
Mr Sleigh said: “A smaller sample of processors reporting figures will increase the risk of the Dapp being more easily influenced by figures from one processor, for example it could be ‘manipulated’.
“For pig farmers, there is no live auction to give a guide to demand and, over the years, the number of abattoirs has reduced, and the ability of producers to change buyers is limited.”
Mr Sleigh said processors, producers and retailers all needed to work together and be in a position where there was mutual trust throughout the supply chain, albeit that was often challenging to secure.
“The decision of Cranswick and Karro will have done nothing to help that,” he added.
Mr McKen said pricing transparency was vital and recommended that all firms processing more than 2,000 pigs a week should be forced to report their buying prices for a new calculation based on grading and gross prices.
That would give the sector a more accurate figure for the UK and allow easier comparisons with the rest of the EU.
He also recommended taking price calculations away from Bpex and handing the role to another department of the overarching Agriculture and Horticulture Development Board so that neither processors nor producers could influence it. Mr McKen said the worry now was that other processors would follow the lead set by Cranswick and Karro.
A Bpex spokesman said: “This withdrawal will reduce sample size. However, Bpex and AHDB Market Intelligence have analysed the remaining sample and are confident it remains representative so will therefore be continuing to publish the Dapp.
“Bpex will continue to review the new sample to ensure it remains representative and is actively looking at bolstering the sample size.”
Mr McKen said the pig sector continued to benefit from “horsegate”, with more UK pork and pigmeat products on the shelves of the major retailers than had been the case for several years.
He also reported Scottish pigmeat returning to the shelves of Tesco for the first time since the Halls of Broxburn plant closed in 2012 with 1,700 redundancies.
Support for the British industry was good, particularly at a time when there was a growing price gap between pigmeat from the UK and cheaper product from the main EU markets in Germany and the Netherlands.
Mr McKen added: “The disparity between us and Germany is at least 35p a kg (15.88p a lb). It’s about the same with us and the Netherlands. But the retailers here are sticking with UK product.”
Mr McKen expects the EU-UK price gap to close in the coming weeks, with European prices likely to increase slightly as UK rates drop.