AHDB: The UK pork industry post-Brexit
Labour shortages and workforce challenges
Since Brexit, labour shortages have emerged as one of the most significant challenges for the UK pig industry. The reduction in EU workers, who had historically filled key roles in the farming and processing sectors, has created staffing shortages. The UK meat processing sector saw employment in the industry decline at an average annual rate of 3.5% between 2019 and 2024. Additionally, the Food & Drink Federation’s State of Industry Report for Q1 2024 indicated that vacancy rates in the sector stood at 5.0%, remaining significantly higher than those in wider manufacturing (2.7%) and the UK overall (2.9%). These persistent vacancies highlight the ongoing workforce challenges within the meat processing sector.
Compounding these challenges, COVID-19 restrictions exacerbated workforce shortages across the industry. Pandemic-related travel restrictions, illness and self-isolation requirements further reduced the availability of workers, making it even harder to fill vacancies. Social distancing measures in processing plants also slowed production rates, adding to inefficiencies. The combined effect of Brexit and COVID-19 created a perfect storm for labour shortages, with industry stakeholders struggling to maintain operations at pre-pandemic levels.
The shortage of butchers, in particular, forced UK companies to adjust by sourcing more processed cuts from abroad, which in turn has alleviated some of the pressure on domestic butchery capacity. For example, in 2019, the final year of pre-Brexit conditions, the UK imported 232,000 tonnes of bone-in pork, whereas in 2024 this figure had declined by 39% to 141,000. In comparison, imports of boneless pork have increased by 3%.
These trends suggest that the UK is increasingly relying on foreign butchery capacity to alleviate workforce shortages.
Export challenges and trade barriers
Since Brexit, the EU has imported 51% less UK pig meat between 2019 and 2024. Although the transition period through 2020 softened the immediate impact, the movement of goods has been more cumbersome and costly, with products facing delays and increased paperwork requirements at the border.
Despite growth in UK trade to non-EU markets, these exports still represent a smaller portion of overall UK pork trade volume and tend to contain less high-value product. However, access to new markets such as Mexico and Vietnam has improved UK export opportunities.
The outbreak of African swine fever (ASF) and the COVID-19 pandemic further complicated the UK's pork export landscape. Initially, ASF outbreaks in Asia, particularly China, led to increased demand for UK pork exports. However, as China's domestic production recovered and the economic impacts of COVID-19 took hold, demand for imports, including those from the UK, began to ease. Compounding this issue, several UK pork processing plants were de-listed by Chinese authorities during the pandemic, restricting access to this critical fifth-quarter market. Notably, two major UK plants remained suspended until December 2024.
However, the UK's departure from the European Union has enabled it to independently negotiate free trade agreements (FTAs) and join international trade blocs, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). These developments were promoted by Brexiteers as opportunities to enhance trade relationships and open new markets for UK industries.
The UK’s accession to the CPTPP presents additional opportunities, particularly with the removal of tariffs of up to 20% on UK pork exports to Mexico. While the benefits of these agreements may take time to materialise, they provide a framework for potential growth in non-EU markets.
Increased costs on domestic production
The UK pork industry has faced a sharp increase in production costs over the past five years. While Brexit has played a role in driving up costs, particularly through labour shortages and higher recruitment expenses, the impact of the war in Ukraine has also been a crucial factor. The conflict triggered a spike in global feed prices, especially for key ingredients like wheat, which makes up around half of GB feed rations. Feed accounts for approximately 65% of GB pig cost of production, a key driver of producer net margins.
The backlog of pigs in 2021, which resulted from labour shortages and processing delays, created an oversupply in the domestic market. This led to a sharp decline in pig prices, compounding the financial strain on producers. At the same time, global economic slowdowns due to COVID-19 impacted demand, both domestically and overseas. The combination of these factors placed significant financial pressure on UK pig producers, with estimated net margins falling as low as -£58/head at the time.
However, it is worth noting that higher inflation and interest rates continue to impact variable cost components such as energy, finance, veterinary medicines and building maintenance.
In conclusion, the past five years have been a turbulent period for the UK pork industry, shaped by the intersecting challenges of Brexit, COVID-19 and global economic and geopolitical pressures. While new trade agreements offer some promise, labour shortages, rising production costs and shifting trade dynamics have reshaped the sector in lasting ways. Navigating these challenges will require continued adaptation, innovation and strategic support to ensure a sustainable future for UK pork production.
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