Thursday, April 28, 2022, 7:07 p.m.
Listening to the academician’s view of the cause of ‘expensive pork’ being hit by ‘4 bounces’ to drive costs Keeper of ‘Say Goodbye’
April 28, 2022 Dr. Suwanna Sairuamyat, Department of Agricultural and Resource Economics Faculty of Economics Kasetsart University revealed that on April 24, 2022, the Pig Board Cost Subcommittee reported the cost of fattening pig production at 98.81 baht per kilogram. This is a record production cost of fattening pigs. Because the price of live fattening pigs at the farm as announced by the association is 96-98 baht/kg, actually trading in some areas has already exceeded 100 baht/kg.
The question is, what is the source of the high cost figure at the moment?
The reason for the high cost of pig production at the moment is due to 4 bounce situations.
first bounce In the aftermath of the African Swine Cholera (ASF) outbreak, the number of sows is insufficient. The production rate of pigs was lower than the previous year. Swine production enters the market declines, and prices will have to increase as demand exceeds the production rate.
bounce at 2 Consequences from the first bounce is the cost of piglets The pork that is sold in the market during this period must go back to January 2022 if we can remember. This was the time when pork prices were the most expensive in history. The price of piglets is also the most expensive. The average price of piglets in January is 3,650 baht/head, making the cost of piglets up to 40.65% of the cost of fattening pig production.
bounce at 3 Feed raw material prices rose due to the Russian-Ukrainian war situation. since February These two countries are the world’s major sources of feed raw materials. As a result of this situation, the price of all feed ingredients has increased. Before the war, raw materials had already increased. Since the beginning of the year, in just three months, the price of maize is up 17.1%, soybean meal is up 13.6%, wheat is 8.3%, fish meal is up 19.3% (Figure 1) (actually, it has been up since 2020. even) even teasing that “The price of raw materials has gone up as if angry with the babysitter.”
In order to fatten pigs to a weight of approximately 100 kilograms, approximately 248 kilograms of pig feed is required, representing a feed cost of not less than 4,000 baht or approximately 45.09% of the total cost. In which a small number of raisers extend the raising time from 100 kg to 110 – 120 kg, of course, the cost of food increases accordingly.
bounce at 4 hot weather Pigs will eat less food than usual, causing them to grow slowly. Farm needs to be raised for longer. The cost of food in the summer is higher than usual.
If asked which bounce the government can alleviate the problem is the second bounce, solving the problem of raw material prices. The Thai Animal Feed Manufacturers Association has proposed three solutions since January 2022:
1. Cancel the import tax on soybean meal of 2%.
2. Cancel the measure to control wheat imports 3 : 1
3. Open to import corn under the framework of WTO, AFTA, abolish quotas, taxes and fees. in a temporary shortage in 2022
All three proposals received only partial response. which has no definite conclusion or accepted by the livestock and feed sectors That is to say, the easing to import maize according to the WTO framework does not exceed 0.38 million tonnes during April-July 2022, which is now about to expire in April. But no concrete action has been taken. However, licensing corn imports could help corn hoarders now surrender to speculative crops.
Another fact is The price of wheat is now as high as corn. Therefore, there is no incentive to import wheat as an alternative feedstock under the 3:1 wheat import control measure. The 2% tariff on soybean meal is canceled, which is the easiest to manage. and can cancel immediately But this measure was held for the longest time. without any response
for measures to control the importation of maize from neighboring countries should have to relax more If the state does not want to aggravate the problem, it will be more difficult to solve. Since the government has set an income insurance policy for maize growers at 8.5 baht/kg and buys domestic soybeans at 19.75 baht/kg, these are things that corn and soybean farmers are already taking care of. Therefore, the market mechanism should be left to work freely.
Due to the protracted Russian-Ukrainian war situation And the production capacity of key soybean and corn producers such as the United States, Argentina, Brazil will likely have problems in the current production year due to high oil and fertilizer costs. These will make the cost of pig production is unlikely to be reduced. That means the price of pork will have to be more expensive. In addition, the government has to tighten restrictions on the smuggling of illegal pork, another important factor that will undermine Thai pig farmers. This will certainly affect hundreds of thousands of agricultural farmers as well.
when the state does not have the ability to solve the problem of the source to manage the cost of raw materials It is imperative to let market forces act. Otherwise, the remaining pig farmers are less than a hundred thousand. Must say Goodbye permanently because of the costs that are currently being carried. Carry them together until their backs are broken. For consumers, they can only manage their pocket money. spend sparingly Because fixing the price of pigs in front of the farm may not be able to order like in the past And in the next few days will have to face price adjustments for many consumer products.
-005
