Government-backed Farm Credit Canada (FCC), Canada's largest farm lender, said it is willing to adjust or defer hog farmers' loan payments, as they struggle to absorb mounting losses triggered by high feed costs, Reuters reports.
FCC, based in Regina, said that it would contact all its pig farming clients and help them to find ways through cash flow problems. Farmers complain that lenders have reduced the availability of credit, which they say they need to stay in business into next spring. Hog prices are expected to rise at that time.
The severe drought and its accompanying increase in feed prices has hog farmers reducing the size of their herds, with as results that the market is glutted with pork and falling prices.
Canada's second-biggest hog farm operation, Big Sky Farms, went into receivership last month, while another hog farmer, Puratone, received protection from creditors.
An FCC official confirmed to Reuters last month that credit availability to farmers had dropped as hog prices fell.
Farm Credit Canada