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Eye On Europe: Coming soon to Denmark - A big increase in the size of the nation's hog farms

Tuesday, February 16, 2010

Danish producers are enjoying an export boom to the German market. But poor economic returns, strict environmental legislation and high taxes are pushing the trend to larger units

by NORMAN DUNN

Squeezed by the recession and with increasingly tighter environmental restraints to production, Danish swine farmers are considering a number of strategies for future survival. Options range from specializing in piglet production, creating a worldwide export market for Danish hybrid sows or doing what the Danes have always done well – staying with bacon and pork production at home.

In 2008, Danish hog producers exported around 5.3 million piglets, mainly to German feeders. This year, the preliminary figure is 6.8 million. "But, in November 2009, this export trade is already nearing seven million," says Martin Andersson of the Danish Pig Research Centre.

The main reasons for this export boom? "At current costs, a Danish piglet costs an average €13.30 (C$20.10) less to produce than one in Germany."

Behind this situation, Andersson explains, are sow management successes and economies of scale. "Twenty to 30 per cent of our sows are now managed in herds of over 1,000 sows." And they're getting even  bigger. "Because of the financial crisis, very few sow barns were built this year in Denmark. But those that were are housing between 1,200 and 2,000 sows apiece."

Average piglets weaned per sow per year is already at almost 27, with the best 25 per cent of Denmark's 2,000 sow herds now managing 29. "This represents an increase of 1.6 surviving piglets per sow each year," points out Andersson, adding that the target for 2020 is 15.3 weaned per litter and 35 survivors per year per sow.

Much of this progress, he says, is due to the Danish strategy of selecting sows on number of piglets surviving at weaning, and not liveborn per farrowing as in the past.

But there are three other important reasons for Denmark's increasing piglet export trade southwards. For a start, German slaughterhouses are paying more for the resulting slaughter hogs. In November 2009, this was the equivalent of nine cents per kilogram slaughterweight above the price paid by the major home player, Danish Crown.

"Secondly, our costs for labour, feed and buildings are higher than those of the Germans, so for some of our farmers it's more efficient to avoid the feeding phase. And then we have the strictest environmental legislation in Europe to pay for and the highest taxes. Altogether, this adds another $8 to the net costs per slaughter hog." 

The attractive slaughter prices in Germany are also leading to more hogs fed in Denmark making the journey to abattoirs across the border. This year, the number is expected to exceed 1.2 million slaughter hogs and cast sows – double the export total in 2005.

Then there's the fact that there's very limited opportunity for expansion of feeding units in Denmark. Among the obstacles: a very restrictive manure application regulation (a limit of 56 kilograms of N per acre) and a law that at least 25 per cent of the land used for spreading manure has to be owned by the hog farmer. The rest of the manure has to be spread on neighbouring land under five-year contracts which, of course, cost money too.

"We are hoping that we can convince government to abolish the 25 per cent land ownership rule, which will at least give more flexibility to those wishing to expand production," says Andersson.

But even without such a legislative change, there is going to be a violent increase in the size of Danish farms very soon, according to Jens Bligaard, a manager with the state farm advisory service. "Today's poor economic returns have stopped any real market movement currently," he says. Hog farmers, for example, did not cover their slaughter hog production costs in 2008, might break even in 2009 and are only expecting to make a small profit in 2011.

The pressure for more land to spread manure in the past meant that land prices spiralled in Denmark – in some cases to the equivalent of $27,500 per acre. Now, low economic returns have some farmers leaving their hog buildings empty, with the result that land prices in livestock areas are now sinking as low as $15,000 an acre and even lower in some cases this winter. Many had bought manure-spreading land for very high (borrowed) sums, according to Bligaard. "Those wanting to get out are having to wait for rising prices. When this situation is resolved, there will be a lot of land waiting to change hands."

Looking further ahead, the Pig Research Centre considers a scenario where reduced environmental legislation might allow larger, more efficient, feeding units. This could result in Denmark changing back to keeping all its piglets and feeding them at home.

"Naturally, this would be some years down the road," explains Martin Andersson. "To be successful here, we would have to devise much more efficient hog feeding strategies, probably along the lines of broiler feeding systems."

He rejects the successful German formula of liquid feeding systems on fully slatted flooring because litter use is, at least in part, compulsory in Denmark. "But our dry rations are currently available in dozens of different versions. We should cut these down to just five or six formulas with feeding house management becoming a skilled job instead of the one hour per day part-time operation it is for many farmers in Denmark nowadays."

One thing is certain, according to Andersson. The main emphasis for Danish hog sector progress will continue to lie with the successful national Danbred hybrid. But more sophisticated selection is to be applied. 

"Genomic selection has been used in dairying for years. We are now starting to apply this in our breeding programmes with total DNA capacity considered and the right animals selected for breeding-on without the hassle of long-term feeding trials.

"Conventional breeding will continue for a while," he adds. "But genomic selection will gradually take over."

Current aim is for 13 to 14 weaned per litter with weaning at 29 days. And the target for 2020 is 15.3 surviving per litter.  Andersson concludes that longer-lived sows also constitute one of the Danish swine sector targets.  "Our average sow produces four litters currently. The optimum should be five to six litters."

Farrowing pen ring protects piglets

Søren Juhl Jensen is a Danish swine producer in Jutland and a man driven by a quest to find a relatively cheap farrowing system without crate.

The quest started five years ago and has been built around the concept of a metal ring fitted about 20 centimetres above the floor inside the pen. The sow lies down within the ring to suckle its litter and an adjustable vertical metal pole inside the ring is positioned so that she is encouraged to lie with her udder towards the creep area.

Unlike many other non-crate farrowing designs, this farmer's pen is not much larger than a standard farrowing pen. In Denmark, farrow pens with crates are usually around 2.70 by 1.70 metres while the Jensen design is 3.2 by 2.0. Additionally, a working lifetime knowledge of swine psychology has helped in designing a floor layout to encourage a clean pen. The solid-floored farrowing area with suckling ring and adjacent creep is at the front of the pen, while behind is the slatted dunging, feeding and watering area for the sow. The sow's presence here when not suckling or sleeping is encouraged by a barred opening on each side looking into the same dunging areas of the adjacent farrowing pens, where neighbouring sows can be clearly seen and heard. This promise of social contact, says Jensen, attracts the sows to the dunging/feeding area.

Back in the ring, the simple curving metal tubing stops the sow from going down suddenly and trapping piglets, according to the inventor. And the adjustable vertical pole within the ring is also effective, he says, in stopping the sow turning over during suckling, another dangerous move which can trap young hogs. 

This innovative hog producer, who has a 200-sow farrowing-to-slaughter unit near Flemming in Jutland, actually designed the pens for another innovation in his production system. "Five years ago, I started changing from conventional weaning systems where the piglets are removed from the farrowing pen with several litters mixed together in grower pens. Instead, I took the sow out and left the litter members in the same pen until slaughter.

"The ring instead of crate in the farrowing/suckling area was introduced because I wanted something that I could dismantle very quickly and remove from the pen."

Jensen has been comparing his design with another non-crate farrowing pen idea   – the Danish "sloping wall" design, where the sow can slide down against this wall and thus avoid sudden trapping of piglets. He runs 20 pens of each type and has another farrowing building with conventional crate pens.

His ring farrowing idea has so far returned two per cent higher mortality (14 per cent) to weaning compared with conventional crates, but has two per cent less mortality than the other free-farrowing idea. "The sows are much more relaxed in the ring farrowing design and tend to have more milk to look after two, three or four extra piglets per litter."

Keeping the litter together in its own pen right through to slaughter has a dramatically positive affect on hog health, adds the farmer. "I have swine in a normal system, too, and I can say that over five years, with the single pen farrow-to-slaughter system, the hogs are going off to slaughter at 100 kilograms, 20 days ahead of the others."

The Netherlands looks to reduce boar taint as castration ban looms

Although there's no timetable for a European ban on castration of male slaughter hogs, political pressure is forcing the issue. Now, the Netherlands –  one of the European Union's larger pork producers, with an estimated 14.4 million hogs slaughtered in 2009 – officially reckons that 2015 will be the date when no boar castration will be allowed for its feeding hogs.

Already, CO² anesthetic is prescribed for most on-farm hog castration (with 90 per cent of equipment costs paid for by various industry support schemes). But this is seen as only a step towards a total castration ban. The Dutch ministry of agriculture and PVV, the country's meat marketing organization, have now invested €5 million in a research program to find the best ways of rearing and feeding entire male hogs so that there's less danger of boar taint in the resultant pork.

LEI, the Dutch Agricultural Economics Research Institute at Wageningen University, has founded a research project called "Towards Boar Meat" and already all leading players in Dutch pork production, from big producers to processors, are involved.

Project leader Dr. Gé Backus from LEI explains that the main focus is on three key factors: genetics, feed management and slaughter line controls. Already being tested for the last-named factor are electronic "noses," some of which are already successfully being used in the meat processing industry. Ways of training professional human "sniffers" are also being investigated.

Topigs, the country's market leader in production of hybrid breeding swine, is already a few years into a program identifying breeding lines in both boars and sows that can produce slaughter boars with less of the taint-emitting components androstenone, skatole and indole.

"We've been breeding for this with the help of genomics and we're optimistic that we'll find the right lines to reduce concentrations of the main boar taint components below the accepted thresholds," reports Peter Loenen, Topigs communications manager. Loenen cautions, however, that a 100 per cent freedom from taint isn't likely, at least so far, from breeding alone. 

"We have to consider the possible effect on fertility and feeding performance with such lines, so it's not a straightforward task," he says. But avoiding castration could also bring sizable economic rewards for hog feeders. The Dutch Institute for Pig Genetics (IPG) puts the feed efficiency of boars at five to 12 per cent higher than that of castrated males.

Intensive research into breeding for no boar taint in pork has also been conducted in Norway, which set a goal of no castration for slaughter boars by 2009. But a complete ban is still not in place there, although all castration has to be carried out under anesthetic, as in Switzerland.

As for the influence of feeding, commercial trials indicate that certain high-fibre rations for boars for one or two weeks before slaughter have a significant effect in reducing levels of the taint-giving compounds.

Researchers from Wageningen University in the Netherlands, as well as a number of Danish institutes, have had success in reducing boar taint by feeding diets with 10 per cent dried chicory roots or up to 25 per cent blue lupine seed. The chicory root fibre resulted in an acceptable reduction of androstenone levels after 14 days inclusion before slaughter, the lupine seed after only seven days.  

But no single approach will give freedom from boar taint with uncastrated male hogs, stresses Dr. Backus from LEI. "Only a combination of all possible approaches can provide the answer."

A biogas plant on every hog farm?

The Danish government is gearing up for a massive change in farming policy aimed at reducing climate-changing gas production by livestock producers. A blueprint being discussed in Copenhagen plans to make 20 per cent capital grants available to all swine (and cattle) producers willing to install biogas production plants on their farms. Those producing electricity for the national network from this biogas are to be offered the equivalent of around C$0.18 per kWh, double that which industrial users are paying for their power at the moment.

Targets of this so-called "Green Growth" program include more than 50 per cent of the manure from the country's 1.5 million cows and around 13 million swine being fermented to gas. Even 50 per cent would be enough to reduce the country's production of climate-changing gases by as much as eight per cent, the government claims.

By winter 2009, there were only around 80 farms (out of around 11,000 livestock farms) in the whole country producing biogas from manure. So far, Denmark has specialized more in centralized municipal or co-operative biogas plants where manure from farmers as well as industrial byproducts, such as slaughterhouse waste, are processed. There are around 20 of these and the biggest plant processes manure from 60 farms with a delivery of 200,000 tonnes of manure yearly.

"Under the ‘Green Growth' program, the state wants to have more than 50 per cent treated before 2020," explains Thorkild Q. Frandsen, chief biogas system adviser with the state agricultural advisory service. First negotiations, he says, suggested that the proposed 20 per cent capital grants should only go for big, centralized biogas plants. "But we want farmers with decentralized plants to get this, too, and we'll be helping farmers negotiate this."

Alternative schemes include the possibility of farmers simply compressing the biogas their units produce and pumping it underground in narrow-gauge pipelines to the nearest community for supplying centralized power and heating stations. One such community is even offering subsidized pipeline services for nearby farms to attract supplies of biogas in this way.

Frandsen says the state advisory service is also helping farmers start negotiations for the right to feed specially prepared biogas straight into the national natural gas pipeline network. BP

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