NFU: Poultry price problem ‘not rocket science’

26-11-2010 | |

The NFU is calling for a fair price for poultry famers at a time when soaring feed prices and increased production costs have left some in the sector operating at a loss.

Inflation in feed prices
Despite recent work to strengthen relationships between British poultry producers and retailers, the NFU believes inflation in feed prices needs to be reflected in the price paid to the farmer.

Poultry board chairman Charles Bourns said: “Retailers look to farmers to invest in ever-improving, often dedicated supply chains, but this deal comes with some responsibility for them to ensure their suppliers are making a fair margin.

“British farmers are a trusted supplier of poultry meat and eggs which meet the high standards that customers expect. However more and more producers are required to meet bespoke retail standards.

Producers making a loss
“These could include things like additional windows, perches in sheds, woodland for birds to range or independent food health and safety audits. With rising costs and now soaring feed prices, this means some producers are making a loss.

“The effect of feed price inflation is clear for all to see. Latest NFU figures suggest that feed is costing farmers an extra 5p per dozen eggs, and over 12p per chicken. And these are just direct costs; there is also the effect of these costs long-term on the breeding flocks.

“Farmers remain committed to the retail partnership, as ultimately this is their route to a long-term relationship with the consumer but this is a crunch time for them. This isn’t rocket science – farmers just need a fair price that covers their cost of production.”

Bourns wrote to all major retailers at the beginning of November to highlight the effect of feed inflation on farmers’ margins. Approximately 60-70% of poultry production costs is feed, with around 60% of each ration made from wheat, a commodity which has risen by £50 per tonne in recent months.

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