Margins pig industry Ukraine increase to 200%

Nikolay Babenko, head of the Ukrainian Meat Association, told local news outlet Interfax that record profitability could lure new investors into the sector. In the long run, establishing pig farms could be a way out for Ukrainian agriculture, which is currently experiencing difficulties exporting grain, Babenko added.

“Before the war, production costs stood at 30 to 35 hryvnias ($ 0.82 – $ 0.96) per kg, while sales price ranged between 45 to 50 hryvnias ($ 1.24 – $ 1.37) per kg. In 2022, when seaports were blocked, feed prices plummeted by a factor of several times,” Babenko said, estimating that the wheat bran fell in price by a factor of 5 times, while soybean cake and sunflower meal by a factor of 2-3 times.

In 2022, global pork prices doubled, and this trend also affected the Ukrainian pig market. Now, the farmgate price has reached 85 hryvnias ($ 2.34) per kg, while the production cost is as low as 20 hryvnias ($ 0.55) per kg.

Fourfold production expansion

“Before the war, Ukraine produced 0.6 million tonnes of pork in slaughter weight, while now this figure dropped to less than 0.5 million tonnes,” Babenko said. He added that the Meat Association is now putting a lot of effort into reversing the downward trend. “In theory, Ukraine could boost pork production nearly fourfold compared to the current level and also start exporting pork. Our meat processing plants that imported pork have many years of experience in trading pork, primarily with EU countries. The farmers are primarily interested in exporting pork to Africa and Asia. The list of top priority countries: Philippines, Vietnam, Malaysia, South Korea, Singapore, South Africa. They consume millions of tonnes of pork.

Lessons learned

Poland, Hungary, Romania, Slovakia, and Bulgaria prohibited the import of Ukrainian grain in 2023 in order to protect the domestic market. This is something Ukrainian pig farmers must bear in mind when developing pork export, Babenko asserted. “To prevent the situation with grain exports from happening with pork, we consciously build relationships with new markets. We have many partners in the global market who help us and enter into partnerships for the pork supply.”

Several companies in the western parts of Ukraine, located relatively close to the European border, are already ready to sell their products to foreign customers.