Canadian Pork Producers:

[mikey]

Thursday, February 05, 2009Print This Page
Producers Advised to Connect with Consumers
CANADA - A Washington based communications strategist is encouraging livestock producers to harness some of the same strategies used by animal rights activists to get their message out, writes Bruce Cochrane.





Farm-Scape is sponsored by
Manitoba Pork Council and Sask Pork

Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council
and Sask Pork. 
Production agriculture has increasingly become the target of animals rights activists who have been extremely successful in bringing about legislative restrictions on livestock producers.

Dan Murphy, a communications specialist with Outsource Marketing, told those on hand for the 2009 Manitoba Swine Seminar livestock producers need to take a page out of their book and adopt some of the same game plan these opponents of agriculture are so gifted at using.

Dan Murphy-Outsource Marketing
They are very skilled at finding the hot buttons to press, whether it's pictures of a poor little puppy abused in some puppy mill or whether it's a baby pig trying to squeeze through the bars of his metal cage.

These groups are very good at knowing how to connect emotionally with things people get upset about and things people care about in terms of animal welfare and in terms of environmental protection.

What I would suggest is that producers find ways to take some of these issues that matter to people, whether it's the environment, whether it's food safety, whether it's economic viability for the rural parts of this country and the States as well and find ways to talk about how their business contributes in a positive way to those issues that people are concerned about.

You care about the environment, you need to understand how livestock producers can be stewards not just of the animals but of the land, the water shed, the soil, things that ultimately contribute to a positive impact on the environment that the average consumer feels very strongly about.

Murphy stresses the livestock industry needs to connect with the public on an emotional level and then talk about the science and the research.

He says, until you make that emotional connection, the science wont make a difference.

 

[mikey]

Friday, February 06, 2009Print This Page
Shortage of Feed Cause for Anxiety in Canada
CANADA - Research conducted at the George Morris Centre, in Guelph, Ontario, shows the US "green" policy of increasing ethanol production could cause hog feed prices to skyrocket.



The report says a catastrophe is shaping up and could lead to a decline in Canada's pork exports, at a time when Canadian hog production is striving to keep up with global markets.

The report also talks about how Canada has failed to recognise the close relationship between livestock and feed grains whilst deciding on policies concerning both sectors.

At present, more ethanol is derived from corn and grains (although the US is coming up with ways to implement its plans to produce cellulosic ethanol). The Canadian capital and other provinces in the country have been working to drive up the use of ethanol in conventional fuels and also boost biodiesel consumption. In 2008, a new regulation was introduced wherein conventional diesel was to contain at least 2 per cent of biodiesel.

According to Canadian news agency, Business Edge, Jacques Pomerleau, executive director of Ottawa-based Canada Pork International, notes the exchange rate and access to international markets will present the two biggest challenges to Canadian pork exports in 2009.

Canadian pork producers are put in a position of disadvantage because US pork rates determine Canada's prices. The US's plans to boost ethanol production through loans, tax cuts and government subsidies does not help with the matter. This impacts both hog and grain sectors immensely.

Currently, both segments are wallowing in the benefits of the low US dollar. But the gains are only short-term and they must both cooperate for the industries to be sustainable.

[mikey]

Friday, February 06, 2009Print This Page
Considering Risk Management Strategies Key
CANADA - The vice-president of live procurement with Maple Leaf Foods reports the recent economic turmoil has increased the level of interest in the use of the various risk management tools, writes Bruce Cochrane.





Farm-Scape is sponsored by
Manitoba Pork Council and Sask Pork

Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council
and Sask Pork. 
To manage risk swine producers can open a trading account with a broker and trade hog futures on the Chicago Board of Trade or currency futures or trade currency futures through their bank or they can use a forward contracting program where the basis, the currency and the hog price are all locked in.

Maple Leaf vice-president live procurement John Carney told those on hand for the 2009 Manitoba Swine Seminar, while this is a tool that may not be used all of the time, it's a tool producers should consider if and when they want to use it.

John Carney-Maple Leaf Foods
I think it starts with understanding your cost of production and your business objectives and those will change over time.

Producers, as we all know, have been through a very difficult time and for some right now it may simply be survival and trying to make it through some challenging markets.

I would say that it starts with having a clear idea what your objectives are and then assessing what are the risks your facing, primarily in currency, in hog price or protein and in feed prices, determining with your cost of production what price that you would like to lock your production in at if the price is available to do so.

But I think the focus more and more is on hedging a margin or a net return per hog as opposed to simply the price.

In other words looking at the feed as well as the hog price.

Carney notes, because there are many programs offered, it's difficult to know exactly how many producers are using risk management programs but participation in the programs offered by Maple Leaf is the highest that it's been in a number of years.

[mikey]

Monday, February 09, 2009Print This Page
Expectations as a Result of Pork Export Market
CANADA - The Saskatchewan Ministry of Agriculture expects the export market for pork to play a key role in setting live hog prices during 2009, writes Bruce Cochrane.





Farm-Scape is sponsored by
Manitoba Pork Council and Sask Pork

Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council
and Sask Pork. 
During 2008 US pork exports increased by over 70 per cent from 2007 driven by large increases in exports to Russia, Hong Kong and China, pushing the US share of the global market to about 40 per cent, compared to the European Union at about 24 per cent, Canada at about 17 per cent and Brazil at about 11 per cent.

Brad Marceniuk, a livestock economist with the Saskatchewan Ministry of Agriculture told those on hand last week for the 2009 Manitoba Swine Symposium, the volume of pork in cold storage remains a concern.

Brad Marceniuk-Saskatchewan Ministry of Agriculture
When we look at the total meat stocks in cold storage in the US we've seen a big jump from 2007 to 2008 on how much meat is in cold storage.

Stocks have increased to over 2.2 billion pounds in the last few months.

While we look at production for 2009 it looks like total production of pork, beef and poultry will be down in the United States in 2009 and we should start to reduce this cold storage number hopefully over the next couple of months.

The one concern here, as we move into '09, now that the US dollar has increased in value, will their exports be as strong in '09 as in '08?

If their exports do decline significantly we could have more pork in storage in here North America which could put pressure on prices in '09.

It will be interesting to see, though, if we do have a recession over the year if more people will be at home and will people start to eat more pork?

Marceniuk points out North American per capita consumption has fallen by about six kilograms per person since 1998 reducing the importance of the domestic market and increasing the importance of the export market.

He notes exports increased to Japan in 2008, there was a large increase in exports to China and Korea and Russia have also been important markets for Canada.

[mikey]

Tuesday, February 10, 2009Print This Page
Improved Pork Outlook Projected for 2009-2010
CANADA - The general manager of the Manitoba Pork Council is optimistic that live hog prices have bottomed out and have started the slow climb back, writes Bruce Cochrane.





Farm-Scape is sponsored by
Manitoba Pork Council and Sask Pork

Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council
and Sask Pork. 
Over the past couple of years western Canadian pork producers have faced increasing feed costs, the sudden rise of the Canadian dollar and the continuing burden of dealing with government on issues like environmental control, trade and so on.

Manitoba Pork Council general manager Andrew Dickson says pork producers have used a variety of strategies to survive and, while we've probably hit the low of the low, it's going to be a slow crawl back.

Andrew Dickson-Manitoba Pork Council
A number of older operations have closed their doors simply because they feel that they're not competitive in terms of being as productive as some of their neighbors.

Producers continue to improve their productivity each year by one, two, three per cent.

They're a lot more careful about things like feed costs and managing them more.

In terms of use of things like antibiotics and feed additives and that sort of thing, producers are watching those very carefully in terms of trying to avoid expenditures where they can.

And, from a good husbandry perspective they've been looking at new techniques in how to manage the disease problem in their barns and in some cases they've made staff adjustments.

Some of the staff in some of these commercial operations are having to work longer hours and with more responsibilities.

Some managers are now working in the barns themselves directly where as in the past they might have spent more time managing other parts of the business.

Mr Dickson says producers have lost money for the last three years but 2009 will hopefully be a period of at least breaking even and then hopefully we can get into 2010 and make back some money and pay off the accumulated debt producers have incurred.

He says the outlook is better, pointing out, even in an economic recession people still eat.

 

[mikey]

Wednesday, February 11, 2009Print This Page
Opportunities for North American Pork Producers
CANADA - The president and CEO of Genesus Genetics is confident Russia will provide an excellent opportunity for North American pork exporters over the next three to four years, writes Bruce Cochrane.





Farm-Scape is sponsored by
Manitoba Pork Council and Sask Pork

Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council
and Sask Pork. 
With the fall of communism the Russian business model collapsed, farming operations when bankrupt, livestock was slaughtered and agricultural infrastructure was destroyed.

In 1992 all of the pork consumed in Russia was produced in the Soviet Union but today 30 per cent is imported, primarily from North America, the European Union and Brazil.

Genesus president and CEO Jim Long points out last year Russia was number four export market, it's a high priced opportunity for people to move all different types of products and they buy all types of cuts not just the cheap cuts.

Jim Long-Genesus Genetics
Right now chicken is increasing quite a bit, pork is expanding.

The Russian cattle inventory has decreased every year for the last 13 years.

They prefer pork.

A slaughter hog in Russia right now is about three dollars US a kilogram or 300 US dollars a market hog so the Russian pork domestically is almost triple what it is in Canada.

The importers are able to buy pork cheaper in Canada, they take it there, they pay tariffs or they arrange to get the pork across the border.

Most Russians we speak to believe that the Russian per capita consumption of pork will move to the European Union average which is 40 kilograms.

Our numbers are telling us that they're at about 17 to 19 kilograms.

To get to 40 kilograms times their population is another 60 million hogs a year.

Mr Long notes, while the Russians are planning on expanding pork production, the size of the infrastructure they will have to put in place is huge and it's going to take a number of years.

In the interim he's confident that market will hold and we'll have opportunities to export pork from North America and Canada to Russia.

[mikey]

Thursday, February 12, 2009Print This Page
Reduced Weight Variation Key to Increased Profits
CANADA - A US based agricultural economist suggests reducing weight variation as pigs grow toward market weight is the most effective way to maximize profitability in the swine barn, writes Bruce Cochrane.





Farm-Scape is sponsored by
Manitoba Pork Council and Sask Pork

Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council
and Sask Pork. 
Weight variation among pigs is a natural biological occurrence that begins at birth and multiplies as the pigs grow and can result in discounts when pigs that are either too heavy or too light reach the packing plant.

Dr. Dennis Dipietre, an economist with Columbia, Missouri based Knowledge Ventures, says many commonly accepted practices add to that variation so, when pigs achieve typical market weights, there's often a spread of about 100 pounds between the smallest and the largest.

Dr. Dennis Dipietre-Knowledge Ventures
If we look at particular practices that cause problems, we know for instance and are correcting that we've driven lactation length much too low.

We did that to try to get the of pigs volume up but, when you separate a pig at 17-18 days from the sow, not only do you do damage to the pig but you also damage reproductive future performance of the sow.

So certainly moving lactation length up to 21 to 23 days is beginning to be a common practice now.

Some of the other things that are just the typical fumbles that we sometimes make on the farm, we have more feed-out events than some producers really realize or water-out events.

Those kinds of stressers to pigs create more variation in grow, especially among the weaker pigs.

I don't mean the five or ten out of a thousand in a building that are obviously sick.

I mean the 300 lightest pigs in a thousand head barn are going to be hurt probably by this much more than the 300 more robust heavier ones.

Dr. Dipietre says his data shows that reducing variation by as much as 30 per cent can add as much as five dollars per head in net return.

[mikey]

Friday, February 13, 2009Print This Page
Backlog of Hogs Expected to be Cleared Up
CANADA - Maple Leaf Consumer Foods estimates it will take about three weeks to clear up a backlog of hogs that resulted from a series of road closures earlier in the week, writes Bruce Cochrane.





Farm-Scape is sponsored by
Manitoba Pork Council and Sask Pork

Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council
and Sask Pork. 
Monday morning most of the roads in southern Manitoba had been closed as a result of freezing rain.

Maple Leaf director of procurement for western Canada Jason Manness says the highest concentration of freezing rain was in southeastern Manitoba, from where the Brandon plant sources a significant volume of hogs, resulting in low volumes of movement Monday and Tuesday from certain areas of Manitoba and Saskatchewan.

Jason Manness-Maple Leaf Consumer Foods
On Monday, Tuesday, Wednesday we were running at probably just around 50 percent capacity of the Brandon plant and so one full shift was impacted throughout those three days.

We are now back to full two shift capacity here on Thursday as well as forecast to do that Friday.

We are also, to help assist with the reduced capacity earlier in the week, planning a Saturday one shift processing for this Saturday so that's already lined up and ready to go.

We're trying to help accommodate the reduced capacity earlier in the week because of the weather.

We'll do our best over the next two to three weeks to get everybody cleaned up in the country, fill the sales commitments that we have to our customers.

It'll take probably two to three weeks to make that happen.

Unfortunately next week we have a holiday, or fortunately for the people that want a holiday it's good but for this business we have a holiday next Monday, Louis Riel Day, which will then compound a little bit and therefore it'll take at least two or three weeks to catch up the volume that we missed this week.

Mr Manness says, while it's difficult to put a dollar value on these types disruptions, they result in additional costs to everyone in the production chain from the producer right through to the consumer.

 

[mikey]

Wednesday, February 18, 2009Print This Page
US Hog Finishing Capacity Moved to Saskatchewan
CANADA - La Broquerie, Manitoba based Hytek Limited has announced it will move approximately 40 thousand swine finishing spaces from the United States to Saskatchewan, writes Bruce Cochrane.





Farm-Scape is sponsored by
Manitoba Pork Council and Sask Pork

Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council
and Sask Pork. 
Hytek has purchased four finishing barns in Leroy, Saskatchewan, each capable of accommodating about ten thousand pigs ranging from 50 to 60 pounds up 260 pound marketing weight.

Hytek vice president of production and genetics Claude Vielfaure says the production facilities are being populated now and will supply finished hogs for the company's Neepawa pork processing plant.

Claude Vielfaure-Hytek Limited
Essentially, since our purchase of Springhill Farms last year, a year ago, we are looking to bring back more of our US destination pigs to Canada so we're able to process them in our Springhill plant.

These animals will be coming from our sow barns in Manitoba.

Again, those pigs from those sow barns were being sold in the US so now we're going to take those pigs from those sow barns and move them directly to these Leroy barns and finish them there and then take the market hogs and bring them back to our Neepawa plant.

We are killing approximately 900 thousand pigs a year at Springhill farms now and, once we finish our wastewater plant which hopefully will be done by the spring 2010, we'll be able to bring capacity up 1.4 million pigs a year.

Mr Vielfaure says the market hogs will be processed into fresh and frozen pork products for sale domestically and around the world.

He notes demands are different depending on where the pork is sold with the domestic market looking for the back ribs, the loins, the hams and so on where as the Asian markets are looking for the legs, the heads and other parts of the pig that we don't normally eat in North America.

 

[mikey]

Tuesday, February 24, 2009Print This Page
Welfare Groups Accuse Canada of Misleading Claims
CANADA - Six national animal welfare groups have come together to denounce statements made by the Canadian government to European counterparts about the protection afforded to livestock animals in Canada.



Prior to meetings in mid-January, the Canadian delegation distributed documents to European Members of Parliament claiming that "Canada is committed to, and has a long history of setting humane standards for animal welfare."

"From Malaysia to Great Britain, from South Africa to the Philippines, advancements are being made in the field of animal welfare. In Canada animals are still not protected from basic acts of cruelty," said Olivier Bonnet, Country Director for the International Fund for Animal Welfare, "Canada has been recognized as a leader in many fields but has not demonstrated the capacity in the foreseeable future to take animal protection and animal welfare seriously."

"Nowhere are the words "animal welfare" even mentioned in Canada's new $1.3 billion five-year agricultural policy, Growing Forward Framework Agreement. That's a clear indicator of lack of interest in farm animal welfare by the federal government," said Stephanie Brown, Director for the Canadian Coalition for Farm Animals.

"Canada is one of the worst places in the industrialized world for animals," said Rebecca Aldworth, Director of Humane Society International/Canada. "Our outdated animal protection laws facilitate serious abuses of animals. From the beating and shooting of seal pups to the proliferation of puppy mills, to the mass force-feeding of geese and ducks to the widespread use of leghold traps--millions of animals are routinely subjected to extreme cruelty in Canada."

"Canada is still in the dark ages when it comes to animal welfare. Most Canadians believe animals should be treated humanely, so it's time our laws reflected that fact", said Robert Laidlaw, Director of Zoocheck Canada Inc.

[mikey]

Wednesday, February 25, 2009Print This Page
Phosphorus Availability Varies According to Source
CANADA - Research conducted at the University of Manitoba has confirmed the availability of phosphorus for loss into the environment varies according the source of that phosphorus, writes Bruce Cochrane.





Farm-Scape is sponsored by
Manitoba Pork Council and Sask Pork

Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council
and Sask Pork. 
To learn more about how phosphorus reacts in the soil and assess potential for run-off losses scientists with the University of Manitoba compared the environmental availability of phosphorus from monoammonium phosphate fertilizer, four sources of liquid swine manure and four sources of solid beef cattle manure under simulated extreme run-off conditions on disturbed coarse textured gavelly soil and fine to medium textured soil.

Soil science professor Dr. Don Flaten reports phosphorus applied as commercial fertilizer was most highly available, followed by liquid swine manure followed by solid beef cattle manure.

Dr. Don Flaten-University of Manitoba
Commercial or synthetic fertilizer like 11-52-0 is the most soluble and stays the most soluble even after it's been incubated in the soil for a six week period before run-off.

Next would come the liquid manure from the pigs barns and then would come the solid cattle manure.

That ranking is important in terms of being careful how we manage each of those nutrient sources.

Thank goodness we put our phosphate fertilizer in the commercial form underneath the soil surface next to the seed after snow-melt.

Actually it's not very much of a threat of running off if it's put on in that way and that's a good thing.

A lot of our liquid manure is injected or incorporated under the soil surface so it's not much of a threat and, in fact, the solid beef cattle manure which was the least prone to run-off, that actually worked out in some ways quite nicely because it's also the most difficult source of nutrient to incorporate and, in fact, it's almost impossible to inject.

So the results showed that commercial fertilizer, liquid pig manure, solid beef cattle manure, they sort of follow that sequence in terms of environmental availability.

Dr. Flaten notes no crops were grown in this experiment so follow-up work could involve looking at the availability of phosphorus for uptake by crops.

 

[mikey]

Friday, February 27, 2009Print This Page
Support for Cattle and Hog Producers Announced
CANADA - Saskatchewan's agriculture minister has announced a 71 million dollar program to assist the province's cattle and hog producers and called on the federal government to provide additional support, writes Bruce Cochrane.





Farm-Scape is sponsored by
Manitoba Pork Council and Sask Pork

Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council
and Sask Pork. 
The Saskatchewan Cattle and Hog Support Program offers 40 dollars per head for beef breeding cows and bred heifers owned as of 1 January 2009 and C$20 per market hog sold and C$10 per head for iso-weans, weanlings and feeder hogs produced between 1 July 2008 and 31 January 2009.

Provincial agriculture minister Bob Bjornerud says a national approach would be preferred but requests for federal involvement have gone unanswered and other provinces have announced programs prompting Saskatchewan to come to the table with its share of support.

Bob Bjornerud-Saskatchewan Agriculture Minister
We have been pushing the federal government to provide increased support to the cattle and hog industry and we have had two specific asks of the federal government, first to provide immediate financial support for the cattle and hog producers and second to immediately change agri-stability to make it more effectively address the current situation facing our producers,

The federal budget announced a month ago today contains significant support for the auto sector in Ontario, and yet the concerns of livestock producers were largely ignored.

I took our concerns recently to the ag ministers meeting in Ottawa.

Unfortunately we were unable to secure any support at that meeting.

Now we are hearing the federal government is considering further support for the auto industry.

It's an industry in trouble and needs support but so do our cattle and hog producers in Saskatchewan.

We are extremely disappointed the federal government has not done something more meaningful for our cattle and hog producers at this time.

Mr Bjornerud says the province will continue to work toward a national solution and is urging the federal government to top-up this program with its 60 per cent share, or to provide some other form of meaningful support.

[mikey]

Wednesday, February 25, 2009Print This Page
Pork Commentary: 90 Cent Lean Hogs?
CANADA - This week's North American Pork Commentary from Jim Long.

Jim Long on ThePigSite

Jim Long is President &
CEO of Genesus Genetics.
This past week we had numerous phone calls and emails concerning our position that there will be 90 cent lean hogs this year (June). These are fair questions. Many if not all producers are worried about their financial position and future. We do not write our views without thought and consideration of the implications. It becomes a responsibility, and maybe a burden. When producers say ‘We read you every week and we keep going because of what you say.’ In some ways it would be easier to run with the pack of economists who just use the lean hog futures as their crystal ball. Right or wrong, we won’t use that as a crutch.

Why do we see 90 cent hogs coming?
The latest Canada – USA swine inventory indicates there were fewer pigs in the lightest weight category. These pigs will begin to come to market at the end of April. We expect USA slaughter to drop year over year 150 – 200,000 per week. In May, 2008, the price averaged 79.59 lean. Show us anywhere in history where production decline this large did not lead to prices significantly higher year over year. We challenge anyone to find it – we can’t!


Last February we averaged 58.72 lean, March 54.04, and April, 62.41. Prices did not explode until May (79.59). At this time last year we were aggressive in expected spring price appreciation. A good friend called and told us to be careful. We were wrong. We were way out of line of what others were predicting. We appreciated the concern but we believe what we believe. Prices exploded!


What about pork exports? The global economy is in crisis – exports will suffer. We look at the countries hog prices that import pork. Domestic hog prices are a reflection of demand and domestic consumer buying power.
Current Hog Prices 
CHINA 84 cent US/pound Live weight
KOREA $1.35 US/pound Live weight
RUSSIA $1.30 US/pound Live weight
JAPAN $2.10 US/pound Live weight
MEXICO 79 cent US/pound Live weight
AUSTRALIA 90 cent US/pound Live weight

These are the major USA importing pork countries and these prices are converted to USA dollars and still the prices remain high despite an average appreciation of 20 per cent by the USA dollar in the last year. Pretty good prices aren’t they? Not exactly price collapse. They reflect each country’s domestic supply and demand. None of these countries citizen’s have the buying power of USA consumers of which 92 per cent of Americans have jobs. We believe our packers have the ability, the capital, the wherewithal to keep pushing pork into these countries with our hugely competitive price points and cost of production advantage.

We are told the Chinese producers are expanding. They probably are. They have expanded on average, 20 million hogs in production a year for the last decade. They also have 1.3 billion people. China still has major swine disease problems. Half of their pigs are in backyards. We do not believe anyone has a real clue how many hogs there are in China. How do you count 200 million pigs in backyards? Prices tell us supply. Sure, China’s prices have declined but 84 cents USA per pound live weight tells us there is no over supply and demand there. They do market about 2 million hogs a day. It’s a huge market – but even if they only imported 1 per cent of their production it is 5 million hogs a year of pork supply.


We also hear about the huge burden of pork in storage. Last Friday the USDA cold storage report came out. Pork in storage was 595 million pounds, up 20 million pounds from last year. The USDA estimates the USA will produce approximately 92 billion pounds of poultry and meat in 2009. 20 million pounds extra pork in storage is about 2/100’s of 1 per cent meat in storage. It’s a Red Herring issue by the Bears.
What about recession hurting pork demand?
It is agreed by most that the last 2 major recessions were in 1973-1975 and 1981-1982. In the Financial Post a week ago there was a chart measuring the severity of our current recession to the previous two cited.

USA Recession Comparisons
  Real GDP Industrial Production Unemployment Inflation 30 Year Mortgage Misery Index
Current -1.1 -6.1 7.6 -0.1 5.2 7.6
1981-1982 -2.7 -9.9 10.8 +14.6 18.5 22.0
1973-1975 -3.1 -13 9.0 +12.2 12.2 19.9
***Misery index - pain of economic crisis. Adds the unemployment rate and the inflation rate 2008-2009.

It would appear to us that the current recession by these measurements is no worse than 1973-1975 or 1981-1982. In all likelihood the perception of the deepness of the current recession is magnified by the internet and 24 hour news channels. In 1973-1975, there were 3 USA T.V. networks with a 30 minute newscast daily and no internet. In 1981-1982, there was no internet and it was just the beginning of cable news. In this recession we are inundated with wall to wall bad news 24/7. Hard to stay positive.

What’s this got to do with the hog market? In the last two major recessions the hog price reached historical highs.

USA Live Hog Market Average
1975 47.10 Previous historical high price to 1973-1973 recession. 23.60 in 1947
1982 52.60 Previous historical high prior to 1981-1982 recession. 47.10 in 1975

In the last two major recessions hog prices reached new highs. Obviously, demand was excellent compared to pork supply. There was a recession but people continued to want pork and pay for it in the face of declines in GDP, Industrial Production, Employment, and increases in inflation, interest rates and misery index. History repeats itself. We expect new historical price highs this summer. All the people who say demand will decrease -- we ask why? Show us the history to back up your premise. Maybe consumers won’t go to restaurants, maybe they won’t buy a new car, but don’t bet against a meat eating society maintaining consumption. The facts are the facts. 90 cent lean hogs are coming. Warn the retailers!!

1975 when lean hog prices reached a new historical price plateau is also the last time USA poultry, beef, and pork had year over year declines all at the same time. It is going to happen in 2008, 33 years later. Not exactly Haley’s comet but not far off in the time between events.


USA cattle on February Feed Report released last Friday.
Thousand Head
  2008 2009   
Feb 1 cattle on feed 11,966 11,288 -6%

We have a Continental Market. The Canada – USA cattle inventory 1 January.

Thousand Head
2008 2009
109,930 107,671

Over 2 million fewer cattle – the lowest inventory since the 1960s. Less is not more.

On a side note – We understand USA dairy producers are in a world of hurt. Milk is 11 cents, cost of production is 16 cents. We understand the average milk cow is losing about $4.00 per day. The USA dairy cow herd is just above 9 million head. 9 million x $4.00 x 30 days in a month = about $1 billion a month in losses. The USA hog industry would have to lose $100 per head to lose a billion in a month! Hogs have been bad. Dairy is in a freefall. Thank goodness there is not much meat on a dairy cow.


What about European pork production? About the same time we hit lower hog production this spring the one million plus sows that have been removed in Europe will decrease their supply. Less for export. Higher hog prices. Price supportive.


Poultry is down year to date about 70 million lbs a week. It will stay down because the breeder flocks have been cut back approximately 5 per cent. Until the breeder flocks expand it is difficult to have more poultry.
Summary
Less poultry, less beef, less pork all at the same time. Not since 1975. In 1975, the year hogs price set new historical highs. 1975, in the midst of a major recession. We have given many of our reasons, we obviously could be wrong but we are convinced 90 cent lean hogs are on the way despite June lean hog futures below 75 cents. We have our reasons it is not wishful thinking.


Author: Jim Long, President & CEO, Genesus Genetics 

[mikey]

Monday, March 02, 2009Print This Page
Less Post-Weaning Diarrhoea with Raw Potato Starch
CANADA - Feeding weaners a diet containing seven per cent raw potato starch reduced scouring but had no effect of performance, according to researchers at the University of Manitoba.



Bhandari and colleagues at the University of Manitoba evaluated the effect of raw potato starch (RPS) on growth performance, post-weaning diarrhoea and gastrointestinal microbial populations in weaned piglets.

Eighty-four piglets were weaned at 17 ± 2 days of age with an average bodyweight of 6.0 ± 0.9 kg. Pigs were blocked by bodyweight and assigned to one of four diets in a randomised complete block design with seven replicate pens per diet and three pigs per pen. Treatments were:

a positive control (PC) containing an antibiotic
a negative control (NC) with no RPS and no antibiotic
NC + 7 per cent RPS (7% RPS) and
NC + 14 per cent RPS (14% RPS).
Diets were based on corn, wheat and soybean meal and formulated to meet NRC (1998) recommendations. The average daily gain, average daily feed intake and gain:feed ratio were determined weekly. Faecal consistency scoring was determined daily. After week 3, one pig with a bodyweight closest to the pen mean was killed to evaluate ileal and colonic mucosal-attached Escherichia coli and lactic acid bacteria, as well as digesta pH, volatile fatty acids and and ammonia-nitrogen concentrations. The DNA was extracted from ileum and colon digesta and used for molecular microbial evaluations using terminal-RFLP analysis of 16S rDNA genes.

Average daily gain for week 1 was greater (P<0.01) for the PC diet but diet had no effect on average daily gain during week 3.

Average daily feed intake did not differ among treatments during the first two weeks, and it was lowest for the 7 per cent RPS diet during wee 3.

The NC diet had a greater (P<0.05) faecal consistency score during week 1 than other treatments but diet had no effect on the score during weeks 2 and 3.

Diets had no effect on the colon lactic acid bacterial counts. However, the PC diet had decreased (P<0.05) colon E. coli counts than other treatments.

Ileum and colon digesta pH and total volatile fatty acid concentrations did not differ among treatments. Pigs fed with 7 and 14 per cent RPS diets had greater (P<0.05) ileum ammonia-nitrogen concentration than pigs fed with other diets.

There was more diarrhoea (P<0.05) in the 14% RPS than 7% RPS and control treatments at day 21. This difference correlated with a decline (P<0.05) in microbial diversity in the colon.

The researchers concluded that 7 per cent RPS can be used to prevent post-weaning diarrhoea in weaned piglets but there are no effects on growth performance.

Reference
Bhandari, S.K, C.M. Nyachoti and D.O. Krause. 2009. Raw potato starch in weaned pig diets and its influence on post weaning scours and the molecular microbial ecology of the digestive tract. J. Anim Sci. 2009. 87:984-993. doi:10.2527/jas.2007-0747.

[mikey]

, March 03, 2009Print This Page
Gov't Responds to Saskatchewan Livestock Program
CANADA - The Canadian government has delivered more than C$1 billion to Saskatchewan pig producers over the last two years, according to Agriculture Minister, Gerry Ritz.



Mr Ritz said: "The Government of Saskatchewan raised this scheme at the federal-provincial meeting last month – every other province soundly rejected it. This kind of program cannot go forward without support from provincial governments."

He also added that other provinces rejected the scheme for good reason. Federal funding for this type of program would likely result in retaliation from trading partners, he said.

"The livestock industry has worked hard to open international markets and that hard work would be completely undone. Producers from Saskatchewan and across Canada could lose more money as markets slam shut than they would get from this kind of handout," Mr Ritz said.

"The Government of Canada is working hard for struggling livestock producers by making sure they have the cash flow they need to weather the current economic storms and by opening marketing opportunities around the world," he said.