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Another Year for Danish Government to Help Pig Sector

23 October 2013

DENMARK - The government has another year to help improve conditions for Danish pig farmers and slaughterhouses, writes Chris Harris.

Last year at the annual meeting of the Danish Pig Research Centre in Herning, the industry issued the “Herning Declaration” that called for political action to help reduce the flow of finisher pigs out of Denmark and more support for the slaughterhouses to process the pigs in Denmark.

However, a year later and the number of finishing pigs being exported to Germany, Poland and Sweden is continuing to rise.

Denmark Herning ConferenceAccording to Nicolaj Norgaard (pictured), speaking during the Pig Research Centre’s annual meeting this year, Germany is still subsidising the slaughter pig industry with tax funding.

Other subsidies in Sweden and Poland are also making it more profitable for farmers to export pigs rather than slaughter and process them in Denmark.

The high cost of production including the high price of fed has forced farmers to export rather than slaughter at home.

However, Mr Norgaard said that the ministry of agriculture is starting to focus of growth in employment and it sees the pig sector as an area where growth can occur.

“The pig sector can be part of the solution to the welfare programme,” Mr Norgaard said.

“We are giving the ministry one more year for the new minister to come through.”

One part of the solution will be to allow farmers, many of whom grow their own feed, to be allowed to use more nitrogen in the soil to increase production and increase the protein content of the grain that will lower feed prices and end a reliance on imported feed.

Mr Norgaard said that with slaughter prices low and feed prices high “we are standing on a burning platform in this part of production”.

He added that the sector expects to see an increase in production despite a drop in the number of farmers.

However he added: “The question is will the pigs be finished in Denmark or in Poland?”

Lindhart B. Nielsen, Chairman, Danish Pig Research Centre said: “The Herning Declaration stated very clearly what is needed to exploit the potential within Danish pig production so that we can achieve growth and protect Danish jobs.

“When I look back, I’m proud of the results achieved through our special advisory programmes, including a feed efficiency improvement of 0.15-0.2 FE per kg growth.

“Our slaughterhouses have also lent their support, with offers of subsidies of 15 øre per kg for new housing investments and our workers’ unions have joined the battle to protect jobs.

Mr Nielsen said that developments during the last year have gone in the wrong direction.

“In the Veterinary Agreement II, our politicians imposed an increased levy on antibiotics of DKK 11 million on 1 January and, since then, fees for welfare controls of DKK 7 million have been levied. Moreover, further legislation concerning loose housing of sows in the service unit, is on the table. This is set to cost half a billion kroner in addition to requirements for extra veterinary visits and additional documentation.. To be fair, however, we must mention that there is now the prospect of an easing of waste water and energy taxes.

“Over the same period, German producers of finished pigs have benefitted further from Germany’s VAT regulations (DKK 30-35 per pig) owing to a higher settlement prices and Swedish producers have been granted an EU subsidy of SEK 1,000 per sow, or approximately DKK 35 per pig.

“Another objective was to boost investments, and so far this has materialised in the government’s “Pig Package” with DKK 150 million in the Environmental Subsidy Scheme, whereby it is possible to apply for a 40 per cent subsidy for those elements of a new housing unit that offer environmental improvements.

”If we can finish an additional two million pigs in Denmark, this will bring in annual export revenue of approximately DKK 3 billion and result in the creation of at least 2,800 jobs. In addition, we can also factor in the additional employment during the construction of a couple of thousand new housing systems - jobs that would benefit hard-pressed rural areas. We must strive to find a better growth initiative than we currently have,” he said.

Chris Harris

Chris Harris

Top image via Shutterstock



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