Abstract/Summary

Value chain analysis (VCA) calculated the financial effects on food chain actors of interventions to improve animal health and welfare in the intensive pig sector. Two interventions to reduce production diseases were studied. A generic chain diagram of linkages between stakeholders and value-added dimensions was designed. Data on structure and financial performance were collected for the sector. The production parameters and financial effects of the interventions were then described to illustrate impact on the supply chain. The effects of the interventions were also assessed at market level using economic welfare analysis. The sectors in Finland and the UK are small in farm numbers and few companies produced much of the output in a largely vertically-integrated structure. The most beneficial intervention in financial terms to farmers was improved hygiene in pig fattening (around +50% in gross margin). It was calculated to reduce the consumer price for pig meat by up to 5% when applied at large, whereas for improved management measures, it would reduce consumer price by less than 0.5%. However, the latter added value also through food quality attributes. We show that good hygiene and animal care can add value. However, evaluation of the financial and social viability of the interventions is needed to decide what interventions are adopted. The structure of supply chains influences which policy measures could be applied. Of the two interventions, improved pig hygiene had the largest potential to improve efficiency and reduce costs. The studied interventions can also provide new business opportunities to farms, slaughterhouses and food sector companies. More evidence is needed to support public policies and business decision-making in the sector. For this, evidence on consumer attitudes to production diseases is needed. Nevertheless, the study makes an important contribution by showing how improvements in health and welfare benefit the whole chain.