Canadian hog production on the decrease
The Canadian hog industry may be about to undertake
one of the sharpest declines in production that it has experienced in recent
In 2007, the country produced 30 million hogs. Canadian federally inspected
hog slaughter was 20.2 million head, down 2.4% from a year earlier. About 56% of
the resulting pork (917,000 mt in 11 months last year, down 4.2%) was exported.
Canada was the third largest pork meat exporter in the world, after the EU, and
USA. Additionally, Canada exported about 3.2 million hogs to the USA for
immediate slaughter, and a further 6.5 million head of feeder pigs for finishing
in the USA and slaughter.
Canadian live hog exports were up 12.9% last year. However, the Canadian
industry is experiencing other troubles.
An appreciation of the Canadian dollar
over the past two years, driven by the international commodity and oil boom, has
caused a huge cost disadvantage on the meat industry. Grain prices have doubled
in a year, driven by the international grain shortage, and by the growing
ethanol industry in Canada and the USA.
Additionally, Canada's booming economy has caused a meat plant labour
shortage. There is now insufficient plant capacity remaining to slaughter all
the hogs produced.
In terms of exports, a prolonged shortage of refrigerated containers coupled
with higher ocean freight rates has made exporting Canadian pork even more
None of these problems appear likely to end in the near future. According to
the UDSA, supplies on farms were 4.2% higher, suggesting that the pork market
will continue to be burdened with heavy supplies for some time to come. Due to
accelerated ethanol production, it is also highly unlikely that feed prices will
decrease in 2008.
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