The price of ham


Many people consider ham to be an expensive product. Far from wanting to get into this type of valuation, in this week’s post we are going to try to explain aspects that influence the the final price of ham and leave it up to you to decide whether its price reflects its true value.

Nobody can deny that there is a range of prices on the market that, in principle, correspond to a varied quality spectrum. From €5/kg for some cured hams to €75/kg for some acorn-fed 100% Iberian hams, the price range is so wide that it might be said that there is a ham to suit every pocket.

Within each aspect we are going to cover (from breeding the pig right up to its drying facilities), we will attempt to differentiate between the different qualities that are usually found on the Spanish market.

Not all pigs have the same production costs

It goes without saying that when we talk about ham, we are talking about the rear end of the pig. Spain is the main producer of this animal in the EU, and it is reared in different ways and so at different costs.

The vast majority of pigmeat production takes place on intensive farms. Practically all white pigs, and pigs that provide fodder-fattened Iberian ham (80% of hams labelled as Iberian according RD 4/2014) are farm-bred. Although both are fattened with fodder, differences arise in their production costs for a variety of reasons. The first is the age they are slaughtered. According to Iberian rules, the minimum age for slaughter of “pigs that give “compound-fed” products is 10 months and “the minimum individual weight of the carcass will be 115 kg” (108 for 100% Iberians that are exceptionally farm-bred). White pigs, not counting exceptions such as Teruel Ham (that regulates minimum warm carcass weight at 86 kg), do not have a minimum slaughter weight so its age will depend on the type of carcass that you wish to get.

Currently, some pigs are slaughtered at barely 5 months old, although it is more usual to wait until 7 or 8 months. This time difference between the two types of pig, already begins to make ham more expensive. On the other hand, Iberian pigs have greater prolificness as the female white pig has a considerably larger number of piglets per litter, making breeding more profitable. In addition, the conversion rate, meaning the efficacy with which the animal is capable of turning the food it eats into body mass, is greater in white pigs, which also lowers production costs. As we have already mentioned in this blog and we like to remind you, PDO Teruel Ham comes under more restrictive regulations than other white ham quality standards, which increases its rearing costs because it requires greater fat thickness, achieved by more food and a later slaughter.

A special mention should be given to Iberian pigs intended for acorn-fed hams (both 100% Iberian and 50 or 75% Iberian race). The extensive rearing method in meadows represents an enormous cost hike compared to farm-fattening. The fact that the number of animals per hectare is limited (varying each year depending on the the acorn production in each field), plus attaining the right weight often takes up to two years (although the standard says a minimum of 14 months), all making breeding this type of pig much more expensive than keeping pigs in pens.

Ham reference price: the markets

To make good quality white ham, nobody in the sector is going to argue about it needing to be fatty. Current trends aim to reduce fat consumption, meaning that most pork production is devoted to getting pigs with high lean yield (cheaper to feed as we saw before), although it is true that there is a section called “charcuterie pigs” with a greater thickness of fat. When buying fresh ham, most abattoirs base their price on what is set at the different markets. These markets decide a price on a weekly basis depending on the type of pig and the offer and demand. Working from this, there are usually three categories of ham: fine (or lean), semi-fatty and fatty. The fat thickness, measured at the tip of the ham, used by the abattoir to sell each one, can vary but might be summarised as approximately less than 1 cm for fine, 1 to 2 cm for semi-fatty and over 2 cm for fatty. Prices go up in proportion to fat content.

In Iberian ham, the markets also set at least a guideline price. In this case, the price of the hams, based of course on the cost of rearing the pig, is defined by two factors: the purity of the race and the handling (form of rearing and feeding). Without going into depth on the Iberian colours (something we will certainly cover in a future post), we might simply say that the price, from lowest to highest, would be for white (compound-fed), green (dry-lot feeding), red (acorn-fed 50 or 75% Iberian race) and black seals (acorn-fed 100% Iberian) respectively.

Concerning both white pigs (PDO Teruel) and the four PDO for Iberians (Dehesa de Extremadura, Los Pedroches, Jabugo and Guijuelo), the prices of these hams are higher, completely justified by the greater quality requirements for their raw materials and the additional cost required to control this.

Weight loss: a product that progressively loses weight

So far, we are already beginning to see price differences in the different legs. It seems obvious that if it takes more time and money to rear one pig more than another, this will be reflected in the products made from it.

Now let’s look directly to ham’s production costs. When a piece enters the industry, its fresh weight varies a great deal according to the manufacturer’s demands, from 9.200 kg for a ham with no foot as required by the TSG Serrano Ham up to 15 kg in some drying facilities. In the case of  La estrella del jamón, we generally work with large raw material, between 12 and 15 kilos.

After the production process that, as mentioned previously, consists of four phases (salting, post-salting or resting, drying and cellar), the weight of each piece is going to be greatly reduced by the natural dehydration process. This is what is known as weight loss and varies according to the type of ham (lean ham loses more weight than fatty ham). In the case of white ham, the TSG Serrano Ham, the minimum weight loss required is 33%. This means that a ham that goes into salting weighing 12 kg cannot be put on sale with this name until it has dropped down to a weight of 8.04 kg or less. The greater the ham’s weight loss, the higher the profit for the producer. Although Iberian ham undergoes less weight loss, its long curing process makes it stand out once again in price from white ham.

Time in the drying facility: financing

Ham is a product that, although processed, does not contain a large number of ingredients that make it more expensive, beyond salt or lard that do require a lot of work because each piece has to be hung and taken down several times to apply them. However, there is one factor that probably adds the most price to the product: time.

From when a ham goes into salting until it can be sold, a minimum of 7 months must pass in the case of cured ham up to 4 or 5 years for a 100% Iberian acorn-fed ham.
In the case of La estrella del jamón, the least cured pieces go beyond 18 months, as far as 24 months approximately in our PDO Teruel Ham Sierra Lindón, 30 for Jamón de Cebo 50% Iberian race Sierra Palomera or 36 at least for acorn-fed 50% Iberian race or 100% Iberian Sierra Palomera hams.

Breeding, market, weight loss and financing are the four factors that justify the price of ham in general, and which demonstrate the great economic differences between making one quality level or another. It is up to you to weigh up if ham is an expensive product or, bearing in mind what we have said here, closer to its cost price and actually good value for money. However you feel about it, keep on enjoying this wonderful product that can adapt to all palates and pockets.

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