The future of Canadian hogs lies in China, says a major processor.
Olymel president Rejean Nadeau told a Saskatchewan pork industry symposium last week that the market’s potential is the source for optimism in an often beleaguered industry.
“The markets have to be opened up,” said Nadeau.
“The domestic market cannot absorb Canadian pork production, especially when American products are increasingly present on our domestic supermarket shelves.”
Quebec-based Olymel slaughters 40,000 hogs a week at its facility in Red Deer, which Naduea said is much less than the facility’s capacity.
Nadeau said access to western ports, room to expand and competitive grain prices means the company is well-positioned to serve the Asian market using its assets in Western Canada.
“Everything is in place and we have to be optimistic in the long run.”
This year, Olymel completed the purchase of Big Sky Farms in Saskatchewan, which, along with independent producers, will supply Olymel’s Alberta pant with Paylean-free animals.
The European Union, Russia and China have banned ractopamine feed additives.
Nadeau said a Chinese firm’s multibillion-dollar purchase of Smithfield, the largest pork processor in the United States, shows how much demand exists in that market.
“(It) sends a clear signal that the Chinese market has and will have a huge appetite for imported pork,” said Nadeau. “Imagine if Western Canada could own only five percent of the Chinese market.”
Nadeau criticized Canadian officials for failing to complete a free trade deal with South Korea when other countries, including the U.S., have already done so.
He was more enthusiastic about Canada’s inclusion in talks with the Trans-Pacific Partnership for Asia-Pacific trade than he was about the recently completed Comprehensive Economic and Trade Agreement with the European Union.
That agreement will allow 75,000 tonnes of Canadian pork to move into the EU, up from the previous quota of 6,000 tonnes.
He said it’s a positive development, but only a handful of Canadian plants are certified for export to Europe. More than 740,000 tonnes of pork products were exported last year to Canada’s top markets: the U.S., Japan and Russia.
Olymel plans to phase gestation crates out of its supply chain by 2022.
“We must conclude that this change is inevitable,” said Nadeau.