Dark Period for Livestock Farmers Due to High Energy Prices

Livestock farmers in Hungary are facing a dark year, with drastically increased energy prices putting a heavy burden on their farms. Only those who have already modernized their stables are safe, but there are few of them.

Zsombor Wagenhoffer, executive director of the Hungarian Animal Breeders Association, told Világgazdaság, a Hungarian economic site, that those farmers who had the foresight to do so had started energy upgrades years ago. They can generate their own electricity and are constantly optimizing their operations. This means that these farmers can now operate at near-zero modest profitability.

But those farmers who have not done so are now in a very difficult situation. According to Wagenhoffer, in the pig and poultry sector, farmers’ expenditure on electricity and gas has increased to the point where energy is the biggest cost factor in production after feed. In this sector, the dramatic rise in energy prices is a particular problem, as heating and cooling climate-controlled sheds requires a lot of electricity and gas, and farmers cannot afford to save on heating for the sake of their animals.

The situation is exacerbated by the fact that livestock farmers do not have the same financial reserves as arable farmers and cannot make up for lost income. Most farms have already used up their reserves, the expert said.

Wagenhoffer also told Világgazdaság that so far there are few farms that are completely self-sufficient in energy, nor is the proportion of farms that use part of their own electricity or biogas production high. Therefore, he said

it is important that all livestock farmers have access to development opportunities that enable them to be self-sufficient in energy.

The expert said that this year is likely to be a black year for the domestic livestock sector. In addition, the steady rise in meat, milk and egg prices makes it difficult to predict how consumption will develop. The situation is exacerbated by the fact that the sector is also exposed to adverse weather conditions – this summer, for example, Hungary was hit by a severe drought.

There is a lot of uncertainty about the future, which is unfortunately leading more and more farmers to think about reducing or, in the worst case, culling their herds. This is why it is of particular importance how we can deliver direct aid and development funds to farmers efficiently and quickly, said Mr. Wagenhoffer.

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