The piece by piece dismantling of single-desk hog marketing across Western Canada will set the industry back 30 years in terms of getting information such as daily hog prices out to farmers, according to the general manager of Saskatchewan’s monopoly hog seller.
“For producers, instead of opening the information channels, we’ve shut them down,” said Don Hrapchak.
“But that’s the way the game goes when you go to an open market and the minister is saying everything is fair in love and war.”
Hrapchak said producers are probably going to have problems finding price information because likely there won’t be much available.
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“The reason this system got together was to maximize returns to producers by making things more open,” he said. “Now you’re not going to know who’s getting what, where or when.”
Varies among provinces
A daily range is now reported in Saskatchewan and Alberta.
In Manitoba, the provincial government releases a value for hogs that includes variations on weight, index and color. That started when Manitoba Pork’s monopoly ended in 1996.
“We need it for planning purposes and farmers need it to know what’s happening in the market,” said Janet Honey, who runs the office in Manitoba Agriculture that compiles daily hog prices.
“I can’t forecast prices for next year if I don’t know what the prices are for this year,” she said.
Honey collects information on sales, carcass weights and the number of hogs killed from the four federally inspected slaughter plants in Manitoba to put together an average slaughter price and the average index 100 price, including premiums and bonuses.
The information is passed on daily to federal agriculture officials and Manitoba Pork, the agency that markets about 80 percent of the province’s hogs.
Manitoba Pork subtracts the average premium bonus, about $1.70, and comes up with its own price.
Compiling the data won’t be as easy in Saskatchewan, which has only two major packers compared to four in Manitoba, Honey said.
“I can’t see them publishing a true average price because then everybody will know what Intercontinental Packers is paying and they may not want that to happen.”
Alberta, also with two packers, provides a price range, not a true average price. Saskatchewan will likely do the same. It puts producers there at a disadvantage, she said.
“The producers can always find out what he could get from calling the packing plant on an individual basis but the big thing is to look at what markets are doing relative to other markets.”
Government and the industry should be able to do better than that, said Marilyn Jonas of Pork Central, a branch of Saskatchewan’s agriculture department.
Required information
“We’re very much in the early stages of this thing but certainly having access to market price is going to be important,” she said.
“I suspect publicly traded prices and what’s happening in Chicago are things people will be watching even more closely than they do now.”
The Winnipeg Commodity Exchange is working on developing a Canadian hog futures contract, she added.
In the meantime, Saskatchewan may follow Manitoba’s lead in calculating daily hog prices.
Honey said the biggest problem with collecting prices directly from packers is that there’s no record of hogs sold into the United States. That number is around 800,000 slaughter hogs and 500,000 weanlings a year from Manitoba.
She said the government tried to collect the data but only two of the province’s three main exporters were willing to provide the numbers.
