Straw prices breaking record levels
In 2017, harvest was a drawn out affair with some difficult conditions, especially in the North.
Lack of straw availability, and high prices, is a concern for many producers. The cost of straw used for finishing pigs and breeding sows on average accounts for around 2% of the total cost of raising a finished pig, according to data from Agrosoft. This equates to around 3p/kg over the past 3 years, although it has previously been slightly higher. Nonetheless, with straw prices now almost 70% above early 2016 levels, the average may now exceed 4p/kg. Of course, these figures are averages across the industry, and the impact of higher straw prices will vary considerably by system. Breeding units, and those using entirely straw-based housing, will be disproportionally affected and in some cases it will simply be availability rather than cost which is the issue.
The EU-spec APP currently stands at 148.41p/kg, only slightly above the average cost of production during Q4 2017 (143p/kg). As such margins are likely to be tight at the moment, and an extra couple of pennies on costs due to higher straw prices could be the difference between a profit and loss making situation for some producers. The latest cost of production figures for Q1 this year will be available later this month.
In light of the high straw prices and limited availability, producers may wish to consider alternative bedding options. To read more about the bedding choices available, click here.
Rebecca Oborne and Bethan Wilkins, Analysts