Earlier this week West Coast Berbice pig farmer Julian Jones related the story of being visited recently by a potential buyer seeking to purchase a considerably fattened sow.
The man looked at the sow, which, Jones said, weighed well in excess of 200 pounds and made Jones an offer of $35,000. The farmer was shocked. The sow was probably worth in excess of $80,000. Jones had been anticipating “doing business” with the buyer but recognised it would have made little business sense to part with his pig at that price. The potential buyer, a middleman who was simply seeking to ‘make a killing’ by buying Jones’ pig at a ‘rock bottom’ price then securing the real market price at the retail end, was not even inclined to negotiate.
Jones kept his sow but his problem didn’t end there. Failure to ‘cut a deal’ meant that he had to continue to absorb the high overheads associated with keeping the animal in his pen. Feed presents the primary financial challenge. A pig’s diet can include rice bran, rice dust and fish or shrimp meal. Bran could cost between $700 and $1000 per bag; ‘boosie’ a further $500 to $700 per bag; shrimp meal: $35 per pound and fish meal $70 to $75 per pound. Pigs may eat between four and six pounds of feed per day – often more. The cost of feed alone dictates that pigs be sold as quickly as possible. Setting feeding costs aside, there are other costs associated with keeping pigs in good health – acquiring vitamins and de-worming the animals.
Jones is not the only West Coast Berbice pig farmer who is caught between the proverbial ‘rock and a hard place.’ Like the others, he is hoping that “a good price” will come along quickly. If not, losses will have to be cut and pigs sold at ‘basement prices,’ which, in many cases, could mean half of what the animals are worth. The middlemen can wait, knowing that a ‘killing’ lies up ahead.
The real life plight of West Coast Berbice pig farmers probably repeats itself across much of the country. What is known as ‘the hog price cycle’ is a vicious circle that is creating serious concerns for farmers. It is simple. In a condition of high demand – during the Christmas season, for example – the price of pork increases. Producers rush to cash in on high prices and overproduction quickly creates a glut and pushes prices down again. The resulting decline in price sometimes causes pork producers to disappear from the industry for considerable periods, sometimes permanently.
Currently there appears to be a glut of pork on the market and some West Coast Berbice farmers say that while pork can fetch a wholesale price of $400 per pound and a retail price of around $500 per pound, butchers and middlemen – whose market is primarily local Chinese restaurants are currently seeking to hold wholesale prices at around $250 per pound. In short, high pork prices trigger major investments in the pig industry.
The industry, meanwhile, is busying itself with seeking to enhance its competitiveness and the quality of pork it produces in an effort to meet the requirements of a demanding international market. Breeding healthier pigs can mean larger litters of piglets; perhaps up to 12 per litter. Larger litters could mean shorter fattening periods and, by extension, better quality pork.
What the farmers say the industry should aim for is a condition in which pigs are sold to the market when they weigh between 70 and 120 pounds though it has become commonplace for them to be further ‘fattened’ in order to enhance profitability. Higher quality pork also significantly enhances the value-added prospects associated with the production of ham and bacon, options that can be particularly profitable during the downside of the hog price cycle.
In 2006, the Inter American Institute for Cooperation in Agriculture (IICA), the Food and Agricultural Organisation (FAO) and the Ministry of Agriculture suggested the formation of a local organisation to oversee the interests of the pig industry. It took seven years for the Guyana Swine Producers Association (GSPA) to materialise. The association says that it is on the verge of commencing an outreach programme across the country that will enable it to interface with local pig producers. Its aim is to facilitate a countrywide collaboration in order to create a corps of best practices that can sustain the industry.
Even a cursory glance at the modus operandi of the West Coast Berbice pig farmers indicates that their marketing methods are, for the most part, archaic. A few of the farmers may have established more reliable urban markets, but the process of buying and selling is often reduced to haggling. The exchanges are mostly between the middlemen who are keen to cart off pigs at the lowest possible price and pig breeders who are torn between selling at prices that bring them worryingly little return and holding on to unsold pigs for a longer period at higher cost to themselves.
Here, the hope is that the association will, among other things, seek to bring buyers and sellers together in an environment that ensures that both parties get ‘a fair shake.’
Part of the weakness of pork producers is that, often, their operations are run like ‘hustles’ rather than businesses; so that they have sorry little idea as to their costs of production. That leaves them vulnerable to exploitation.
A significant development in the industry in recent times is the arrival in the market of a new breeding interest. Chinese investors are ‘ramping up’ local pork production by importing high-quality breeding sows. Here, the fear is that the most important local market, Chinese restaurants may cease to have an interest in the local breeds of pig.
Some pork producers want technical assistance from the state in the form of slaughtering facilities and the creation of factories to facilitate value-added production. Others believe that the industry should ‘hack it’ alone.
Export potential is currently virtually non-existent. It is a matter of both quantity and quality.
The GSPA says it wants to create a shift away from the tradition of having a few pigs “running around in the yard” then slaughtering them in one fell swoop. That could prove difficult in circumstances where old habits die hard.
