The Scottish Government

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3.3. Organic Pork

During 2004, total UK imports of fresh pork (organic and non-organic) rose by 50 % and processed pork products by 14% in 2003 and 2% in 2004 ¹⁶. Imports of organic pork increased from 33% in 2003, to 50% in 2004.

Retail sales of organic pork have continued to increase albeit at a slower rate than beef and lamb, but not at a rate quick enough to sustain domestic production, which has declined as a consequence.

Due to a difference between UK and European organic standards, it is more costly to produce organic pork in the UK ( UK organic pigs have a requirement to spend more of their lives outdoors). Retailers are able to reduce costs by importing organic pork even though UK production could meet demand, resulting in the relatively high levels of imports seen in the UK.

3.3.1. Survey results - volumes

The survey elicited responses from 10 producers who are involved in the production of organic pigs in Scotland. The respondents were reluctant to disclose production, marketing and price details. However, the processor survey indicates that during the year July 2004 to June 2005, approximately 17,000 weaners were produced in Scotland, equating to more than a third of the UK's total (47,000) ¹, the majority of which (10,000) are then transported to England for finishing.

For the year July 2005 to June 2006, respondents predicted that they would have a total of 6,905 finished organic pigs available for sale. It is clear that a small number of relatively large producers who are under contract, account for the majority of organic pigs reared in Scotland. These producers are rearing on a batch system resulting in the peaks seen in figure 3.4.

3.3.2. Market outlets

The survey suggests that approximately two thirds of organic pigs reared in Scotland are exported to England for finishing. Of the remaining 7,000 pigs, the vast majority, (96%) are produced under contracts and sold through the multiple retailers. A large proportion of this pork, which is sold to the multiple retailers is processed elsewhere in the UK, usually long distances from where it was produced. It is unclear whether any of this pork is returned to Scotland for sale or for further processing. Of the Scottish pork that is processed in Scotland the vast majority is sold to the multiple chains.

Unlike conventionally produced Scottish pork that is commonly sold as Scottish, organic pork is not sold with a label of origin and therefore its provenance is lost. This, in practice, makes the origin of the product irrelevant for the retailer as it will have no bearing on consumer demand. Additionally, as well as pork being exported for multiple-retail sales it is clear that around 2000 organic pigs are imported into Scotland for processing and sale, further reducing opportunities to increase market penetration.

Around 3% of the total sold from Scottish abattoirs is sold to independent retailers. The remaining pork is sold to food services and direct to consumers (table 3.2.). The general trend seen below was found in results from both the processor and producer surveys.

Table 3.2. Market outlets for Scottish organic pork products

It is clear that the direct sales market for pork products is not as well established as the red meat sectors. The high proportion of pork being sold to the multiple retail sectors makes sourcing Scottish organic pork a difficulty for many small suppliers. However the premium for meat in the direct sales market suggest that if producers are able to invest in processing facilities (with all the associated costs), they may be able to develop more local and direct marketing networks, but only if supply network challenges can be overcome.

3.3.3. Penetration

The results of the survey show that, as is seen with organic beef and lamb, organic pork produced in Scotland is traded freely throughout the UK and its provenance is lost. Therefore it is extremely difficult to establish definite market penetration levels for Scottish organic pork, or without branding and infrastructural developments, to develop strategies to increase these levels.

The British Retail Consortium estimates that 39% of organic bacon/ham products and 50% of organic fresh pork sold by multiple retailers is sourced from UK. Scotland's organic pig production equates to 33% of the UK's weaner production and 14% of the UK's finished pig production. An additional 2,000 are imported directly to a Scottish processor to satisfy retailers needs.

TNS figures suggest that Scottish consumers account for 5.4% of the UK's total spend on organic food. Scotland currently produces 15% of the UK's finished organic pork or 7.5% of the total organic amount of pork consumed in the UK. Therefore Scotland has the potential to reach 100% market penetration for organic pork. However, a number of factors prevent this from happening. Chiefly, the inadequacies of Scotland's organic pork processing infrastructure means that it is not possible to ensure that any Scottish organic pork is returned to Scotland for retail. Additionally, the absence of any country of origin branding prevents retailers and ultimately consumers from being able to choose Scottish organic pork. The unnecessary importation of an additional 2,000 organic pigs highlights the inadequacies of the sectors processing capabilities. After discussion with stakeholders it has become clear that whilst some Scottish organic pork may be retailed in Scotland, there is no way of ensuring that this happens and therefore it is impossible to calculate a level of market penetration for organic pork.

3.3.4. Summary

• In the UK, 50 % of the organic pork sold by multiple retailers is imported;
• Scotland's organic pig sector produces 33% of the UK's weaners and 15% of finished organic pigs;
• Scotland produces enough finished organic pigs to reach 100% market penetration;
• it is impossible to calculate a level of market penetration for organic pork.;
• In order for the levels of market penetration to increase, there is a need for greater traceability that will enable separation from the rest of the UK's supply network. Only then can provenance be maintained and market penetration levels improved.

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