Grampian Pig Producers
28 King Street, Huntly, Aberdeenshire AB54 8DG
Chairman: J. Gordon Stephen Managing Director: Gordon McKen
Tel: 01466 792284 Fax: 01466 794028 E-mail: gordongpp@aol.com
The peaks and troughs of a notorious cycle of returns have made the pig sector one of the most volatile in agriculture. The volatility reached crisis proportions in 1998-99 when the industry experienced an unprecedented depression in price.
Producers departed the industry in droves with a reduction in Scotland’s sow population of 40%. Grampian Pig Producers Ltd, however, lost only 11% of its breeding numbers, a measure of the faith and confidence of its members in the security provided by the group.
Grampian Pig Producers was formed in 1979 and now has 140 members from Ross-shire to the Borders providing the Scottish processing industry with 10,000 pigs per week.
The aim is to provide producers with a return above the industry index the Average All Pigs Price (AAPP), achieved by a combination of market management, collaboration with key customers and relevant producer information to maintain quality standards. The management and IT systems in place communicate advice back to the farm allowing the group to respond immediately to market requirements with measurable improvements in deliverance to specification.
Gordon McKen, Managing Director: “Communication is a vital part of the process. Producers receive a market update each week which allows them to track industry movements and trends. We provide advice on the type of pig required and on issues such as feed, health, handling and grading.
“A major advantage for producers is flexibility of marketing. Our processing customers are seeking a regular flow of pigs which in turn demands a planned production cycle from member farms. If that cycle is disrupted, say, by a health problem on a farm, the group can cover on numbers. An individual producer would find that impossible with the processor moving elsewhere for supplies.”
Grampian Pig Producers market around 60% of Scottish pigs. The bulk of production is for the bacon market - quality, heavy pigs weighing 75-80 kilo deadweight - and all from Scottish Pig Industry Initiative (SPII) assured farms. The group has forged contractual relationships with a number of processors and is the main supplier to the two largest processing plants at Buckie and Broxburn.
Gordon McKen: “Consistency and continuity have developed these relationships. Producers and processors respect each other’s strengths.”
Grampian Pig Producers has in place a refined operational structure that has delivered tangible benefit. The group has minimal overheads operating as a non-profit making organisation with a levy on members and pig numbers covering management and administration costs.
Systems continue to be evaluated but arguably the significant advantage for producers is the payment arrangement now in place.
The spur was the pig crisis of 1999 when many producers were on the brink of financial collapse. With traditional payment periods in the industry 16-25 days following delivery, cash flow was paramount. The group was able to negotiate a facility to ensure that producers were paid within three to four days. Today, all members of Grampian Pig Producers receive weekly payments direct to their banks - a regular flow of income that has stemmed from group strength.