Pork business loses its fat

POSITIVE: CONSUMERS BENEFIT AS PROCESSED AND COLD MEATS BECOME CHEAPER

Outbreak of listeriosis continues to hit pig farmers hard in the pocket.

South Africa’s pork industry and its value chain could suffer losses of up to R1 billion, as the meat price continues to decline in a fallout from the recent outbreak of listeriosis, according to an FNB economist.

A variety of ready-to-eat processed meats, mainly made from pork, have been recalled from supermarket shelves after being identified as the source of the disease outbreak.

Paul Makube, a senior agricultural economist at FNB, said although the lower prices were concerning for the industry, they were a blessing for consumers feeling the pinch of rising food costs, who were likely to settle for pork as a cheaper alternative.

Makube said this trend would probably continue over the short term.

“The pork industry unnecessarily suffered a severe blow following the recent outbreak of listeriosis, the loss to the value chain so far could exceed R1 billion,” he said.

“Even though demand for processed and cold meats fell sharply due to the health and safety concerns from the listeriosis outbreak, pork farmers have now had to redirect the pigs for the fresh meat market, thereby creating a surplus and in so doing, have further increased pressure on low prices.”

Makube said another positive for consumers was the decrease in the cost of maize, a large component of animal feed.

Maize constitutes over 75% of livestock feed, hence its supply and prices have a major influence on the total cost to customers.

This is particularly the case in poultry and pork, as they are mainly produced under intensive feeding systems.

“SA now has a surplus in maize and the expected 2017-18 production is estimated at over 12.42 million tons,” Makube said. – ANA