Aims of the inquiry
1. The British pig industry comprises some 470,000
breeding sows producing just over nine million pigs a year equating
to approximately 800,000 tonnes of bacon and pork for the food
chain.[1] England
accounts for about 82% of the UK's breeding pigs, Scotland 9.4%
and Wales under 1%.[2]
Approximately 92% of pigs are kept on 1,400 modern commercial
farms and the rest on some 10,000 small holdings and farms. The
average pig herd size on a modern commercial farm is in the region
of 500 breeding sows. In England, most herds are situated in the
east of the country.
2. The pig meat supply chain consists of producers
(farmers), the marketing of pigs from farm to abattoir, processors,
sometimes specialist manufacturers and then retailers. Carcases
are broken down into prime cuts (e.g. pork chops and steaks) which
are generally sold to retailers and cheaper cuts (e.g. legs, shoulders
and bellies) which may be sent to food manufacturers or exported.
3. The consumption of bacon and ham in the UK has
remained fairly constant over the past 10 years (between 400,000-500,000
tonnes per year), but the consumption of fresh pig meat and other
processed pig meat has increased since 2001 from 700,000 to 900,000
tonnes.[3] Despite
this increase in demand, between 1997 and 2007 the size of the
UK pig herd decreased by some 40%, although by 2006-7 the national
herd size appeared more stable.[4]
The increase in demand has been met by an increase in imports,
particularly from Denmark and the Netherlands.[5]
Over half the pork meat eaten in the UK is imported.[6]
4. The pig industry is highly competitive and is
known to be a cyclical one. Traditionally, producers would react
to an increase in profitability by expanding their production.
This would then lead to a fall in pig prices and producers contracting
their businesses, eventually leading back to an increase in profits.
However, it has been argued that the reduction in production of
36% between 1998 and 2007 is not simply a low point in the "pig
cycle", the term given to the regular fluctuation in the
size of the national herd in response to market demand, but is
indicative of a long-term erosion of the competitiveness of the
industry.[7]
5. On 17 July 2008, the Committee announced its inquiry
to examine what was wrong with the pig industry in England. In
particular it asked:
- Are present problems more than
just a cyclical imbalance between supply and demand?
- Are domestic pig welfare standards a principal
reason that English producers have problems competing with those
outside the UK? Are there other reasons?
- What could supermarkets and the hospitality industry
do to alleviate the pressure on the domestic pig industry?
- Can the Government do more to support the industry
either directly or through its public procurement policies?
6. The Committee received 28 submissions. We took
oral evidence from: British Pig Executive Ltd and National Pig
Association; British Meat Processors Association; British Hospitality
Association; Waitrose and British Retail Consortium; Rt Hon Jane
Kennedy MP, Minister for Sustainable Food, Farming and Animal
Health, and Duncan Prior, Policy Advisor, Livestock and Livestock
Products, Department for Environment, Food and Rural Affairs.
We also received an informal briefing from the Office of Fair
Trading and the Competition Commission. We are grateful to all
those who gave evidence to or assisted us with the inquiry.
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