Pig Numbers up or down …
Weanlings, Isoweans, small pigs, or simply piglets for years farmers shipped to the United States midwest, millions every year, to satisfy hog finishers who simply appreciated the mostly Manitoba and Canadian breeding stock. Manitoba cold winters and bigger spaces in between breeding barns, and of course excellent breeders, breeding stock, and farmers kept American farmers signing long lucrative contracts with weanling and Isowean producers in Manitoba.
Then of course the perfect storm hit, including high feed costs, exchange rate evening out, and low pig prices, not to mention the hovering cloud in the distant future, just above the horizon, the once timid and tame M-COOL labelling, telling people where the product comes from.
Canadians have no problems telling people their product comes from Canada, but they have a huge problem, billions of dollars worth when some factions in the U.S. were able to convince the Obama government to make labelling mandatory on all livestocking going across the border. Initially, packers balked at the idea, thinking it wouldn't be a big problem, but Tyson's has now stopped taking Canadian livestock to process in the U.S. The company claims it costs too much to keep separated processing lines, one Canadian, the other home grown in the U.S.
Hence, an artificial trade barrier at the Canadian/U.S. border driving down the price of Canadian livestock.
Alongs comes a dreaded disease, so far, not knowingly in Canada, but those in the know in Canada are waiting for the shoe to drop.
Perry Mohr, the general manager of h@ms Marketing Services says the spread of Porcine Epidemic Diarrhea in the U.S. has the potential to boost marketing opportunities for Canadian weanling producers.
One hates to say what goes around comes around, but producers in the United States took their weanlings from Canada for a good reason. Now, an outbreak in the US of this disease may well turn around and let the Americans know Canada still has good breeding stock, the best in the world claim many breeders, although obviously biased to some extent.
Americans have confirmed Porcine Epidemic Diarrhea in 18 U.S. states and, with the onset of cooler weather, its spread appears to be picking up after having slowed.
Mohr says the spread is increasing in North Carolina, a state that produces a tremendous number of weanling pigs and, with mortality rates among baby pigs running between 80 and 100 per cent, that's expected to start impacting U.S. slaughter rates.
"We do not believe that it has had any impact to date on slaughter rates," he said.
"Initially we thought that, between November and January, it could take about two per cent of the hogs off of the U.S. slaughter and what that means is probably about 100 thousand pigs a week we were expecting to not be available."
Mohr says some people think it could create opportunities for Canadian weanling producers in the U.S. and he believes that to be true.
However, he says the one mitigating factor to the opportunities created for Canadian producers of course would be the fact the U.S. has the M-COOL legislation in place and very few processors today are purchasing hogs of Canadian origin and slaughtering them.
"So I would be somewhat guarded in suggesting that's going to create a huge opportunity at this particular time," he said. "Unless the U.S. processors make a concerted decision to not adhere to the Country of Origin Labelling legislation and buy Canadian pigs just simply to keep hooks full.
Mohr says the situation isn't yet serious enough to cause those processors to consider that.
Jim Long, international hog commentator says marketing by USA-Canada producers are down by approximately 1.7 million so far this year compared to last.
Small pigs referred to earlier from Canada to USA are also down so far. Year to date 3.373 million down 12 per cent from a year ago.
"Cheaper feed and strong demand is the reason cash feeder pigs at $70 plus dollars are $30 per pig higher than a year ago. We expect cash feeder pigs will reach $100 per head," said Long.
He says U.S. Cattle on Feed Report for October 1, indicated eight per cent fewer head on feed than a year ago, over 800,000 less. Going forward lower beef production will be rocket fuel to keep hog prices strong.
"We don't think any significant sow herd expansion has happened as of yet," Long says. "We are aware of many potential sow barns restarting and few new barns talked about. As of this moment mostly talk with no gilts going into any of them." •
— By Harry Siemens