The acronym INAPORC is used to designate the various professionals in the French swine sector, from livestock feed producers to swine slaughterers and pork processors, including breeders. We say to ourselves that the conditions seem to be in place to, through this structure, establish hiring policies that allow each link in the sector to live from their work. But things don’t happen like that. In France, the evolution of pork prices continues to depend on prices on the Plérin watch market in the Côtes d’Armor. Pigs are sold there in batches, using the top-down auction technique. As a result, the reference price does not take into account changes in production costs. It fluctuates according to the law of supply and demand across the world.
To measure the perverse effects, it should be noted that this reference price in Plérin was around 1.25 euros per kilo between October 2021 and February 2022. Hence this observation contained in the dossier delivered yesterday to journalists in Paris on the occasion of the press conference that closed the INAPORC General Assembly: “Farmers have not reached their break-even point for almost a year, due to the increase in pig feed prices, which represent almost 70% of their production costs, and the low market prices for pork”, reads the first half of this paragraph.
10% of farms could disappear this year
Interestingly, the INAPORC text makes no reference to the average price of €1.25 per kilo of carcass between October 2021 and February 2022, while the average price per ton of corn rose by 20% over the same months. was true for soybean and rapeseed meal. But he points out about the situation at the beginning of the summer: “While its production cost exceeded the two euros mark, the sale price stagnated at 1.70 euros for two months and has just gone up for fifteen days. Under the influence of a terrible scissor effect, the cash flow of breeders is being harmed and 10% of the 10,000 French swine farms could disappear this year.”
This risk is real, despite the one-off aid of 350 million euros announced by the government to try to counter the perverse effects of a globalized price obeying the single law of supply and demand, without taking into account the evolution of production costs. We must add that the same danger also exists in other sectors such as poultry meat, chicken eggs, beef cattle and milk production due to the increase in the price of cereals and vegetable protein seeds transformed into cakes. Added to this is a hot and dry summer followed by an equally dry spring, which increases production costs in pasture farming.
30% of pork exported and 25% imported to France
France produces 9% of the hogs raised in the Europe of 27. It exports 30% of its swine production, much of which is in the form of charcuterie, while many lower cuts such as legs, ears, snouts and part of the bacon are purchased from China. . But France also imports 25% of its pork consumption almost exclusively from other EU member countries. In the latter, Spain produces 21% of production and Germany 20%, according to INAPORC. We then imagine that the pigs raised in Spain are fed mainly on corn and soy pie imported from the American continent. As for Germany, we know that the methanization of livestock effluents for electricity production brings additional income to many farmers, whether they produce pigs or cow’s milk.
According to INAPORC, each Frenchman consumes an average of 31.6 kg of pork a year, 81% of which at home, including fresh meat and charcuterie. In second place comes poultry with 28.3 kg per capita ahead of beef with 22.2 kg. Invited to speak at the end of this general assembly by the president of INAPORC Thierry Mayer, Marc Fesneau, the new “Minister of Agriculture and Food Sovereignty”, insisted on underlining the importance of “Food Sovereignty” in his ministerial role. But he did not elaborate on how he intends to bring it to life. However, Thierry Mayer reminded him that the price of a ton of swine feed reached 345 euros in April 2022 against 240 euros in January 2020. According to INAPORC, “the duration and intensity of this crisis have plunged farmers into in serious and serious financial difficulties. In the absence of money, 10% of the 10,000 French farms could disappear today.”
When Bruno Le Maire asks for promotions
But difficulties also affect processors. Also according to INAPORC, “40% of delicatessen companies offer products whose prices do not cover production costs. 25% of charcuterie companies could be forced to reduce their workforce by 2022 and many are seeing the risk of failure increase.” Because they are also subject to increases in production costs through energy and packaging prices, while votes on two EGALIM laws in 2018 and 2021 did not allow these increases to be fully taken into account in annual trade negotiations. at the beginning of March 2022.
This means that much is now expected of the “Minister of Agriculture and Food Sovereignty”. But we tell ourselves that Bruno Le Maire, Minister of Economy and Finance, may have already decided to soap his board, speaking out this week in favor of multiplying promotions in stores to compensate, in part, for the loss. of household purchasing power. This is still part of the policy “and at the same time”, dear to President Macron.