Pig farmers urging Tesco to pay ‘fair price’ for pork
PIG farmers are urging Tesco to take urgent action and pay more or risk losing its British pork supply base.
In an open letter to Tesco chief executive Ken Murphy, the National Pig Association (NPA) said four out of five producers could “go out of business within a year” unless their financial situation improves.
The NPA is appealing directly to the retail giant to pay a “fair price” for pork or risk “losing its British pork supply base forever”.
In the letter, NPA chairman Rob Mutimer stressed that Tesco, given its scale, is “uniquely positioned” to act to prevent the “destruction of the UK pig sector.”
“A relatively modest investment by Tesco will not only prevent the destruction of the sector, but it will mean that British pork will still be available at a price affordable to your customers. Paying a little more today is likely to save you money in the long term,” he added.
“Unfortunately, we don’t have the luxury of time and each week that passes puts pig farmers further into the red.”
UK pork producers are currently facing unprecedented losses as costs of production soar due to record pig feed prices. The NPA points out that it currently costs an estimated 203216p per kg to produce a pig, a figure forecast to rise even higher, as wheat prices continue to increase due to disruption caused by war in Ukraine. Yet average pig prices remain below 170p/kg, meaning many producers are losing tens of thousands pounds each week.
Mr Mutimer said retailers “hold the key to injecting more money into the supply chain” and “several of Tesco’s competitors” have already responded to NPA calls to increase their pig prices. “The Co-op, Marks & Spencer, Aldi, Asda, Morrisons, Sainsbury’s and Waitrose are now paying more for British pork through their dedicated supply chains.”
But Tesco, the UK’s biggest retailer, which has just announced a trebling of profits to more than £2 billion, is
“yet to respond to the crisis hurting its pig suppliers”, he highlighted.
“A similar commitment from Tesco would make an enormous difference to the many farmers that supply you.”
The NPA says there are still 100,000 pigs stuck on farms that should have been sent to slaughter, with farmers losing in excess of £50 per pig due to the enormous gap between their cost of production and the price that retailers were willing to pay.
The organisation adds that 80% of pig farmers surveyed indicated that they would not survive the next 12 months if things did not improve, and estimates that by 2023 British pork will be in such short supply that most retailers will be longer be able to source it.
“Unless action is taken now and a fair price is paid, there will not be a domestic pig industry left to service the demands of your shoppers and we know how much they value fresh British produce,” Mr Mutimer writes.
“I fully appreciate that every part of the supply chain is under strain from inflationary pressures and your customers are struggling with the cost of living. However, I am sure that shoppers and shareholders alike would want you to back British farmers and ensure that we can supply you with fantastic pork for decades to come.”
The NPA is also urging its members to write to Tesco directly to make a similar plea, whilst copying in their local MP.
Mr Mutimer concluded: “Tesco’s famous mantra is ‘Every Little Helps’ – well pig farmers need a lot of help and if Tesco doesn’t step up to the plate, it is going to struggle to source British pork in the future.”
A Tesco spokesperson said: “We fully recognise the seriousness of the situation UK pig farmers are facing, and have been working closely with our suppliers to understand what more we can do to support the sector.
“Through the buying models we already have in place, our suppliers have increased payments to farmers by £3.4 million since March 2022. However, we would like to do more and are actively working with our suppliers on a further enhanced payment plan to support farmers in the short term.”
Meanwhile, Waitrose has recently announced a £16 million support package to help its pork suppliers manage spiralling production costs. The retailer said the funds will cover the full cost of rearing and producing pigs – including labour, feed and fuels – in a move it hopes will offer its suppliers financial security.
James Bailey, executive director of Waitrose, said: “This investment is a direct response to some of the most challenging conditions the pig sector has ever faced. This is not only the right thing to do, it will ensure we continue to pay our farmers a fair price while maintaining our quality and high welfare standards.”