Who is going to slaughter our pigs if the Americans won’t buy them?
News that American pig feeders are dropping contracts with Manitoba weanling producers is sending a chill down the spines of hog producers.
If American buyers look at the country-of-origin labelling requirements about to be made law in the latest farm bill and believe it is not worth the hassle to keep track of Canadian origin pigs, it will devastate the industry here.
So far this year, 1.97 million feeder pigs have been exported to the U.S., up 27 percent over last year at the same time. Slaughter pig exports are up 26.5 percent to 889,000.
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Currency, feed prices and slaughter capacity are all behind the rise in animal exports.
We have not heard anything about Americans shunning fed hog imports, but the weanling issue is problem enough.
With the closure of several hog packing plants in recent years, it is unlikely that Canadian slaughter capacity is up to the challenge of processing all the pigs produced here. That means a significant portion of the pig production industry will have to close down.
To get an idea of how much the industry relies on American feeding barns and slaughterhouses, in the final quarter of 2007, 32 percent of Canadian pigs marketed went to the United States. In the West the number was higher, at 48 percent.
Let’s hope that American buyers are simply being cautious until they know how best to handle COOL regulations and will resume buying once the picture clears.
Grain markets this week will likely be fixated on the outlook for rain in the U.S. Midwest. The heavy rain stopped on the weekend, but the forecast called for showers this week. It is not yet serious seeding time and if the weather becomes drier there shouldn’t be significant delays. But if the wet trend continues for another few weeks, seeding delays could push corn higher and that will help to lift the whole grain market.
Of course, if the weather settles into a normal pattern, the prospect for super yields emerges because of the excellent soil moisture.
It would be good if some of the moisture came north to the parched southern Prairies where seeding will begin in a few weeks.
China’s northern provinces are also dry this spring but some rain fell last week.
Rainstorms lashed some of India’s wheat just as harvest is to begin, raising the prospect of damage and lodging, but the country’s agriculture secretary said he has not reduced his forecast of 74.81 million tonnes of wheat.
Crops look good in western Europe. Germany said this week its winter wheat crop could reach 23.6 million tonnes, up almost 14 percent from last year.
The European Union should harvest 283.86 million tonnes of cereals this year, up from 254.30 million in 2007, according to EU grain trade lobby Coceral.
In its first outlook for the new crop issued March 28, Coceral said soft wheat production could climb to 128.61 million tonnes against last year’s 111.72 million.
Corn could climb to 54.52 million tonnes, up from 46.34 million in 2007. The rapeseed crop, accounting for the bulk of overall oilseeds output, could edge higher to 17.93 million tonnes from 17.69 million in 2007, it said.
