Another 93 pig producers have thrown in the towel, at least temporarily, on the Canadian pork industry.
Preliminary results of the fourth and final tender in the Hog Farm Transition Program (HFTP) were released last week by the Canadian Pork Council.
The results show that 93 hog producers are eligible to receive a total of $14.2 million if they empty their hog barns and cease pig production for at least three years.
The HFTP is a $75 million program designed to reduce Canadian pork production and allow a glut of pork to work its way through the North American market.
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Under the program, registered producers who wish to leave the industry were encouraged to submit bids in a series of tenders.
The bids stated how much money a producer would require to mothball his hog barns and get out of pig production for at least 36 months.
In the fourth tender, which concluded March 10, 274 bids were submitted, with successful bids ranging from $494 per animal unit equivalent (AUE) to $889 per AUE.
An AUE is a measurement that compares sows, weanlings and market hogs at different stages in the production cycle. It is used to determine a producer’s overall inventory.
Successful bidders in the fourth tender now have until April 15, 2010, to confirm their participation in the program.
If confirmation is not received by then, unused funds will be redistributed to the next highest bidders.
Producers who wish to appeal HFTP decisions have until April 15 to submit a formal written appeal.
The $75 million HFTP fund has now been fully allocated.
An estimated 430 hog producers are expected to take part in the program, reducing the country’s sow herd by about 137,000 sows, or 10 percent of the national inventory.
At the beginning of 2010, Canada’s sow inventory stood at approximately 1.31 million animals.
Gary Stordy, public relations manager for the pork council, said administering a program that pays producers to leave the industry was not an enjoyable process but will provide a lifeline to producers who might otherwise have been facing financial ruin.
“It’s not a program that anyone is necessarily happy to be offering … mainly because it’s potentially taking (producers) out of the industry.”
On the bright side, it will help some highly leveraged producers meet debt obligations and stay afloat, he said.
