Bell Food Group hit by pork price rises
It estimates that its EBIT for the first six months of the year will be less than CHF50m, down from CHF55.2m in the same period of 2018.
The business said the outbreak of African swine fever in China had led to “major upheavals” in the international market for pork.
“Exports from the EU to China have increased significantly, which, in addition to lower production, has further reduced supply in Europe,” it said in a statement. “As a result, procurement prices have risen by more than 30% in the first half of this year, with even significantly higher increases for certain cuts.”
Pig prices have been a source of much consternation of late, with the National Pig Association in the UK criticising domestic price movements compared to the rest of the world, branding them “an insult”.
Bell Food’s international charcuterie segment has been particularly affected, most noticeably in Germany, where higher procurement costs have not yet been able to be passed on to sales prices to the extent required. This, combined with the weather-related weak start to the barbecue season and the planned non-recurring costs resulting from the reorganisation of the Bad Wünnenberg plant, have had an additional negative impact on earnings.
It said that despite this price rise, its Bell Switzerland division was doing well, and that its convenience division was continuing to develop “very positively”.
