Fattening Iberian Pigs Indoors vs. Outdoors: Production Performance and Market Value

SIMPLE SUMMARY: This study attempts to analyse the technical and economic data of Iberian-breed pig farms that operate using two differentiated production models, i.e., the cebo or indoor fodder-fed pig production system where the animals are reared indoors, and the cebo campo or outdoor fodder-fed pig production system where the animals are reared outdoors with access to outdoor areas also during the fattening stage. The paper shows the study of three farms from each system with three batches per farm, where the data are obtained by way of a survey directly carried out with the farmers. Despite the conversion ratios being higher in the outdoor system, they do not translate into a significant increase in feed costs. However, labour costs are higher in the outdoor than in the indoor system. Gross margins are higher in the outdoor than in the indoor system, mainly due to the difference in incomes. Such incomes can vary temporarily subject to market prices. The outbreak of COVID-19 meant a sudden decrease in the gross profit, as the incomes went down and the costs remained at the same level. Crisis situations usually cause a reduction of the retail prices and a decrease in the profits. ABSTRACT: The current Quality Standard regulating the Iberian pig provides for various differentiated farming systems subject to the type of management implemented and the breed of the pigs. This study attempts to analyse the differences between two of these production systems, i.e., the outdoor and the indoor rearing systems by comparing the main technical and economic factors of six farms, three operating under each system, in order to ascertain the most profitable production system. This analysis is based on the information provided by the farm owners. It also evaluates the impact that the COVID-19 pandemic outbreak had on profitability. The results show that both systems spend the same resources on animal feed, which represents nearly 60% of the expense, with the price of purchase of piglets representing 30–32% of the total; however, there are differences in the cost of labour, which is higher in the outdoor variant. In economic terms, outdoor farms obtained a higher gross margin than indoor farms did. Although their production costs are higher, these are offset with larger incomes due to the higher market price of the pigs at the time of slaughter. Lastly, all the farms under study reveal large financial losses on account of COVID-19, given that there was a general decrease in the revenues due to the decrease in the selling price of the pigs, which seems to be the most determinant factor for the economic profits made by these kinds of farms.