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Canada, Finding the Right Level?

by 5m Editor
19 May 2011, at 10:49am

CANADA - Statistics Canada has released the results of their latest survey of Canadian hog farms. They concluded the Canadian swine-breeding herd on 1 April was 0.2 per cent smaller than a year ago, but market hog numbers were up 1.4 per cent, writes Bob Fraser, Sales and Service, Genesus Ontario.

The Canadian sow herd has now been below the year-earlier size for 24 consecutive quarters and is only 81 per cent of the size of April 2005. When combined with USDA's March survey, it appears that the March hog inventory in the two countries was up roughly 0.8 per cent from a year earlier and that spring farrowings will be down 1.9 per cent and summer farrowings down 2.1 per cent.

Canada's Hog Inventories

As of 1 April, Canadian farmers had 11.8 million hogs on their farms, up 1.4 per cent from the same date in 2010, despite a 3.5 per cent reduction in the number of hog operations, reports Statistics Canada. Approximately 5.5 million hogs were slaughtered during the first quarter, down 2.8 per cent from a year earlier and 1.4 million hogs were exported, down 3.6 per cent from the same period in 2010.

Hog inventories on 1 April
2010
('000 head)
2011 % change
Canada 11,650.0 11,810.0 +1.4
East 6,764.0 6,862.0 +1.4
Atlantic 129.0 130.7 +1.3
Quebec 3,900.0 3,880.0 -0.5
Ontario 2,735.0 2,851.3 +4.3
West 4,886.0 4,948.0 +1.3
Manitoba 2,550.0 2,615.0 +2.5
Saskatchewan 750.0 775.0 +3.3
Alberta 1,490.0 1,480.0 -0.7
BC 96.0 78.0 -18.8

Canada's Breeding Inventory

Statistics Canada says the hog-breeding herd appears to have stabilized. As of 1 April 2011, sows inventory remained virtually unchanged at 1.29 million head. In Ontario the breeding herd is also estimated as steady with the previous quarter. Usually this data is also compared to the previous year, however, the Ontario estimates for April 2010 were substantially lower than both Jan. and July 2010, and therefore the year over year changes may not give an accurate indication of trend changes. The estimates show Ontario's breeding herd and market hog inventories are up over 6 per cent and 4 per cent respectively. While it would be reckless to take it as a sign of expansion in Ontario, the report does give a strong indication that Ontario's breeding herd is stabilizing after shrinking consistently since 2004.

Ontario
4/1/11 4/1/10 % Change
Sows and Gilts 345.7 324.1 +6.66%
Other (Mkt) hogs 2501.1 2405.1 +3.99%
Under 20 kg 921.6 840.1 +9.70%
20 - 60 kg 825.3 837.8 -1.49%
Over 60 kg 754.2 727.2 +3.71%
Canada
4/1/11 4/1/10 % Change
Sows and Gilts 1291.3 1293.9 -0.20%
Other (Mkt) hogs 10501.8 10336.2 +1.60%
Under 20 kg 3551.1 3504.5 +1.33%
20 - 60 kg 3410 3428.4 -0.54%
Over 60 kg 3540.7 3403.3 +4.04%

These results are superbly explained in the excellent graphs and charts from John Bancroft’s Weekly Hog Market Facts. As you can see the Canadian experience of the past five years has been longer, deeper and harder losses and now after a very brief period of profitability in 2010 followed by more losses we are now only seeing a faint glimmer of profitability (hope). So Canada (Ontario) very much remains an industry at a crossroads. While producers are working very hard to raise their game and adapt to new realities they are going to require further and better encouragement (profits) or further contraction is possible. Any expansion certainly appears to be a long way away.