The carnage in the hog industry is clear in Statistics Canada’s numbers released April 24.
As of April 1, Canada had 19.3 percent fewer hog farmers than a year ago. Those farmers had about 13 million hogs, down 11.7 percent from April 1, 2007, the largest year-over-year drop in three decades.
High feed costs and soft slaughter prices are taking a toll on the sector.
“The hog industry in Canada is in a state of transition as the feed costs and slaughter prices, which have been prevalent in the hog market for some time, have squeezed profit margins to the limit,” said the agency.
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Neil Ketilson, general manager of Sask Pork, said the next quarterly hog inventory report will be worse.
“I don’t think (the hog numbers) are down as significant as what they’re going to be. I think it’s an indication of what’s coming.”
For instance, the Saskatchewan breeding herd was down 3.3 percent in the April report. Ketilson expects a 10 percent year-over-year decline by the time the July report is issued.
“I think the numbers are just starting to show up,” he said.
Alberta and Saskatchewan led the West with a 16.8 percent decline in their respective hog herds. Manitoba’s herd was down 8.9 percent.
Alberta’s breeding stock decline of 7.1 percent was more than twice as large as the other prairie provinces, but it still seemed surprisingly low, said Ben Woolley, vice-chair of Alberta Pork.
“It’s a bit of a grim industry at the moment, that’s for sure,” he said.
Woolley said Alberta Pork is in line for some budget tightening due to reduced levy dollars, but its focus is to get the industry back on its feet.
“That comes first, way before we start to worry about how much revenue we’re going to lose.”
To that end, Alberta Pork is preparing a long-term action plan for the province’s hog sector.
The interim report has already been presented to Alberta’s agriculture minister.
“He was pretty fired up about it and says he thinks we’re heading in the right direction,” said Woolley.
A final version of the report is to be presented to the minister May 1. It provides recommendations on how producers and the packing industry need to work together in developing foreign markets for Alberta pork, how to drive costs out of the system and how government programs can be improved so they don’t increase production costs.
Ketilson said Sask Pork also faces some tough times. It receives its funding from a 75 cent levy on market animals and a 20 cent levy on weaners. He predicts a “very significant” decrease in revenues, especially into the next calendar year.
“We’re going to have to downsize the same as everybody else. We have to adjust our spending habits and what we do in here and tighten our belts,” he said.
