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* Number of countries miss Jan. 1 deadline to ban sow stalls
* Non-compliant farms facing closure
* Problem could hit EU pork production, exports
* Commission rules out EU trade restrictions
By Charlie Dunmore
BRUSSELS, Jan 28 (Reuters) - Some of Europe's biggest pig producers including Germany, France and Spain face legal action over their failure to meet a Jan. 1 deadline to implement new EU animal welfare rules, EU sources said.
A quarter of the bloc's 12 million sows are still being kept on farms where individual cages known as sow stalls remain in use, despite being banned from the start of the year.
The huge scale of non-compliance could raise fears of a larger-than-expected drop in EU pig production as a result of the ban, which could increase pork prices for consumers and dent soaring European exports to Russia and China.
The level of compliance is particularly poor among large producers in France, according to data submitted by governments to the European Commission, EU sources said.
"It's now up to these countries to take action, and in some cases that means closing down whole farms," said one source speaking on condition of anonymity.
The Commission, which enforces European Union animal welfare rules, is preparing legal action against countries that have yet to meet the deadline, with a formal announcement expected next month.
The bloc's health and consumer affairs commissioner, Tonio Borg, was due to raise the issue at a meeting with EU farm ministers in Brussels on Monday.
Despite the prospect of legal action and farm closures, officials said the Commission would oppose any move by EU governments to block imports from countries that failed to meet the deadline.
Last year the Commission banned the export of eggs from producers who failed to meet a Jan. 1, 2012 ban on battery cages. But the difficulty in tracing pork meat back to individual producers compared with eggs, especially in processed products such as salami or chorizo, makes a similar ban impossible, officials said.
Sow stalls, or gestation crates, are metal cages roughly 2 meters long and 60 cm wide used to hem in pregnant pigs and make them easier to control.
While some producers say the cages reduce ear-biting and other forms of aggression between sows, animal welfare campaigners say they cause psychological damage to animals that end up caged for most of their adult lives.
The EU ban was first agreed in 2001, and several EU countries including Sweden and Luxembourg outlawed their use before the EU deadline. Britain has had a ban in place since 1999.
In total, 10 EU countries met the Jan 1. deadline: Austria, Bulgaria, Estonia, Latvia, Lithuania, Luxembourg, Romania, Slovakia, Sweden and Britain.
Malta and Hungary say they have since enforced the ban. Several other countries including the Netherlands, a major producer, are likely to be close to full compliance, the sources said.
In October, Commission officials told a meeting of EU farm and industry experts that pig production would fall 5 percent by 2014 as a result of the rules.
French pig producers' group FNP estimated the ban would add 650 euros ($880) per pig to costs in a sector where many farmers are already breaking even or making losses.
EU farmers produced a record 22.7 million tonnes of pork in 2010 - twice the volume of the United States but still far behind China's output of 51 million, EU and U.S. data showed.
EU pig production currently amounts to 110 percent of its consumption, so while domestic shortages are unlikely, the bloc's growing exports could suffer.
In 2011, its pork exports grew more than 20 percent to reach 3 million tonnes, with Russia and China among the major destinations. ($1 = 0.7421 euros) (Reporting by Charlie Dunmore; Editing by Veronica Brown and Jane Baird)