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Carol Davis

Senior Analyst – Farm Economics



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Cost of Production and Net Margins

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Estimated cost of pig production and estimated net margins

The results shown in the following charts should only be considered as estimations and indicative of general trends because: 

  • Physical and financial performance levels can vary greatly between producers
  • Physical performance used in the estimations are based on 12 month rolling averages and updated in the calculation every three months
  • The calculations are based on monthly spot compound prices. The estimated monthly feed costs do not take into consideration risk management strategies used by individual businesses
  • The estimated monthly feed costs in the calculation do not reflect the lifetime average cost of feed to produce a slaughter pig

The first chart shows the various estimates that make up the estimated total cost of production together with the price per kilo (DAPP EU Specification to 2014 Q3, then APP EU Specification).

The quarterly estimated net margins shown in the following chart are based on the difference between the price per kilo and the estimated total cost of producing pig meat (including depreciation costs) for an average producer using current known physical and financial assumptions.

An explanation of the method used to calculate the estimated cost of production can be found here.



Click here to download quarterly cost of production and net margin data