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Hog inventories

by 5m Editor
24 October 2003, at 12:00am

CANADA - Canadian hog producers reduced their inventories modestly in the third quarter. All provinces experienced limited declines. Inventories edged down to 14.4 million hogs as of October 1, 2003, down 1.2% from July 1 and 3.3% from October, 2002.

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Despite the decline in the total inventory, the size of the breeding herd remained about the same compared with July 1 and, in fact, increased 2.9% compared with October 2002. This structural change in the industry is linked to rising exports of weaner (young) pigs to the United States to be fed south of the border.

Inventories peaked in October 2002. However, a combination of poor prices for hogs and high prices for feed grains led to diminishing profits, if not losses for some producers. In turn, this led to a decline in the number of hogs held on farms.

Hog prices and price prospects have been improving following a collapse in the fall of 2002, although they remain well below the higher prices experienced as recently as 2001. The September 2003 price was about 25% higher than the price in September 2002, which was the lowest point in the year. Many hogs are produced under contract, protecting the producers from short-term fluctuations in cash prices.

Hog prices are primarily determined in the United States, where they strengthened following the collapse one year ago fuelled by demand and rising beef prices. The closure of the US border to Canadian beef on May 20 was also a factor. Beef prices rose as supplies south of the border tightened, boosting pork prices at the same time.

Exports of pork meat rose as countries such as the United States, Japan, Mexico and Australia imported more pork. Exports from January to August were up 22% from the same period of 2002.

Exports of live hogs, primarily to the United States, rose 24% in the first nine months of 2003, compared with the same period of 2002. Slaughter slowed down during the third quarter, dropping below both the previous quarter and the comparable quarter in 2002.

Further Information

To view the latest Hog Statistics report, please click here (PDF Format)

Source: Statistics Canada - 22nd October 2003

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