Rising price of pig feed supply chain components means meat could be more eFarmers have always been in a delicate economic position, constantly being asked to produce more meat, vegetables and dairy more quickly and with less cost. Particularly difficult is the plight of the pig farmer, who could be facing a very tough autumn as the prices of his supply chain components rise.

Buying feed accounts for roughly 60 percent of the cost of raising pork. This summer's rise in the prices for many of pig feed's key components, including wheat, soya and barley, could mean it will be especially difficult for pig farmers to make ends meet this fall.

Perhaps nowhere else in the modern world are the prices of various supply chain components so quickly and obviously reflected in the price of the objects that consumers buy. Though most pork eaters have never fed a pig, consumers will be paying for the extra cents tacked onto all that barley, wheat and soya when they buy pork loins and other cuts of meat at the butcher counter this year. However, in order to stay competitive, farmers won't be able to raise pork prices high enough to cover all their expenses - which means that they could be falling into the red, after only a very brief spell of improving returns.

"Even if producer prices maintain their current value, the industry is forecast to be making a loss by the final quarter of 2010," James Park, a pig market analyst with Britain's Agriculture & Horticulture Development Board, told Farmers Weekly.

"Buyers must be in no doubt about the significance that their pricing policies for pigs, poultrymeat and eggs will have in the coming weeks and months," added Philip Sleigh, a representative of NFU Scotland. "Continued failure to recognize current rising production costs would have very serious implications for the future supply chain in both directions" and in countries ranging from Australia to the U.S.
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