New regulations on pig welfare have come into force on 1 January 2013. Pig stocks in the European Union could fall by as much as 10 percent and the price of pork could rise substantially with the implementation of new animal welfare regulations.

From Jan. 1 2013, sows will have to be kept in groups rather than in individual stalls during most of their pregnancy.

Acording to BPEX ( a division of the Agriculture and Horticulture Development Board in the UK) report published in October 2012, the EU Commission announced in June that 18 Member States had confirmed that they expected all of their remaining pig breeders to be compliant with the new regulations by 1 January 2013. The Member States involved were: Belgium, Bulgaria, Czech Republic, Denmark, Estonia, Germany, Hungary, Ireland, Latvia, Lithuania,Luxembourg, Netherlands, Malta, Romania, Slovakia, Spain, Sweden and the UK. Although many of these Member States are already close to full compliance, some will need to make rapid progress to meet their commitment without losing a large proportion of production.
Of the remaining nine Member States, five are expecting to be over 90 per cent compliant by the end of the year. These are Austria, Finland, Greece, Poland and Slovenia. Of the remainder, Cyprus and Portugal will have lower compliance rates, while France has not yet provided data to the Commission and Italy has provided data but has requested that the Commission do not publish it because of the way it was collected.

Some farmers are likely to leave the industry, especially in Spain, a major producer where a credit squeeze will make it more difficult to implement  the new regulations.

Alberto Herranz, director of the Ancoporc pork trader’s association in Spain, said estimates of a 5-10 percent drop in herd numbers were «very reasonable».

«Some farms won’t be able to adapt because they cannot get the financing, or geographical conditions will leave them without room to expand and they won’t be viable with a lower head-count,» he said.
The BPEX report points out that significant efforts have been made in Spain to ensure that all producers are compliant or cease production by the end of 2012, including provision of finance, communication and training. The government has required producers to submit plans for adaptation or stopping production. It is believed that most of the larger commercial producers have already converted or have plans in place to comply by the end of the year. However, compliance is currently lower among smaller producers and some reports suggest that a large proportion of these may leave the industry or convert to finishing. If this turns out to be the case then it could lead to a sizeable fall in production.
Only around half of German pig breeding farms had converted to group housing, with another 30 per cent planning to do so by the end of the year. It is likely that most of the remainder is made up of smaller farms and some of these will leave the industry or switch to finishing. The German government has confirmed that they expect all producers to be compliant by the end of the year but has not published any plans for how this will be achieved, given the significant number of producers who have not yet converted.

A 10 percent drop in pig numbers would threaten the EU’s position as a pork exporter.

«There are expectations that the changes in 2013 will make the EU a net importer of pork,» a spokesman for the German Farmers’ Association said.

The EU exports pork to countries such as Russia, Hong Kong and China. Exports in 2011 were worth about 4.6 billion euros according to European Commission figures. Germany and Spain are the EU’s top two pork producers.

Stewart Houston, chairman of English pig farming group BPEX, said the new welfare regulations would lead to a decrease of  5 and 10 percent in the EU’s pork production as some pig farmers will exit the industry.»

He said some farmers would struggle to get planning permission and implement changes that cost about 300 pounds ($485) a sow before the end of the year.

Moreover, high cereal and soya costs mean there is little incentive to do so, Houston said, adding that preliminary BPEX figures showing a 3 percent drop in the European sow herd between 2011 and 2012 indicated the change was already underway.

A recent report issued by BPEX estimated that a drop of the EU pig herd of 5 percent would lead to a price increase for finished pigs of 10 percent.

However, a 10 percent decline in the herd would lead to serious shortages of pigmeat across the EU and substantial price increases, the report said.

He said the new rules could curtail EU pork exports but may not lead to an increase in imports.

The reaction from EU politicians and consumers will influence how much EU production will drop, and if we are going to get imports to the EU from countries not fulfilling the EU welfare standards.