Bank of Ireland Predicts Recovery in Pig Prices Later in 2022 as Current Market Turbulence and Steep Feed Prices Produce Challenging Conditions
Bank of Ireland is predicting a recovery in pig prices in the second half of 2022, as it confirmed its support for Irish pig farmers while the sector works to meet the ongoing challenges posed by spiralling feed and production costs. The Bank, which has 40,000 farming customers and provides more than a 50% share of new lending to the agri sector, has met with a number of key industry stakeholders and customers in recent weeks to further understand the challenges being faced and outline the supports it can offer.
Despite many pig farmers enjoying solid profitability in the past number of years, the industry remains particularly exposed to global market conditions and price volatility. Over the longer term the pig industry is well positioned, being a highly efficient and productive part of the agri-economy, but given the current cyclical challenges financial supports are likely to be required in the short-term.
Bank of Ireland believes that it could be the second half of 2022 before a recovery is seen in pig prices and a return to more “normalised” levels in the cost of feed, and is now encouraging pig farmers to talk to their Bank of Ireland advisor. Given the existing constraints many farmers may need to avail of additional working capital to ensure continuity of operations in 2022, with Bank of Ireland’s AgriFlex product also providing interest only loans for a six month period.
Eoin Lowry, Bank of Ireland Head of Agri Sector, commented: “While there are no doubts that market conditions right now are very challenging for pig farmers, it is also important to highlight that the relevant supports are in place. Existing arrangements like the Brexit Impact Loan Scheme, offering borrowing rates of 2.95% to provide working capital over 1 – 6 years, can provide pig farmers with the breathing room they need to ride out the current market turbulence.
Our view remains that while there are present challenges to be faced it is likely that the market will undertake a form of recovery in the second half of 2022. I believe that pig farmers should not hesitate to engage with us in order to protect their bottom line and ensure their businesses are well placed when the recovery kicks in.”