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Genesus Global Market Report: Canada – Chinese rollercoaster, September 2019

Given the wild ride of 2019 a review of my last four commentaries seems appropriate.

13 September 2019, at 8:00am
pork market prices

As has been said “forgetting history dooms you to repeating it” or at least repeating it in your writing. So here below at risk of redundancy is our ride to date in 2019.

I write a Canadian Commentary every eight weeks. January 28, 2019 producer profit projection per pig with average production stood at(-$22.26), March 18, 2019 (-$34.07), May 20, 2019 $55.39, July 18, 2019 (-$5.03) and now September 9, 2019 (-$9.20).

I believe not even the most ardent rollercoaster enthusiast would enjoy this ride. Let alone feel the euphoria of May has been even close to enough of an offset for the rest of the red ink.

producer profit per pig chart for 2019
2019 Producer profit projection / pig

© Bob Hunsberger, Wallenstein Feeds, Hog Economics Summary Sheet

Now a further eight weeks on we have profitability going from per pig with average production loss of (-$5.03) to a loss of (-$9.20). Then with the next twelve-month projection moving from $22.06 to $33.80. A pause before for another meteoritic rise or plunge? Or is the rollercoaster going to give us a period of relative calm?

Hog economics report summary sheet

Fortunately, pork producers have a unique ability to ignore “talking heads”, if they listen to them at all. (note on “talking heads” – the kettle calling the pot black). They do there own thinking and here in Ontario/Canada seeing some small, cautious expansion. Particularly generational turnover, as mothers and fathers with a long view of what the pork industry has done for them encourage sons and daughters into the game. I am personally involved with several of these that are heartening for the industry.

As to where from here, it still remains all about China. However, predicting where that goes has become an increasing mugs game. Seems the between a rock and a hard place has become an ever-tightening geopolitical vice, especially here in Canada. As to the “dog getting to the end of the chain”, clearly the chain is considerably longer than most have thought. Perhaps we need to consider closer who the dog in fact is. Or more importantly who Foghorn Leghorn1 is (a known big mouth snook)???

For all you Looney Tunes2 Fans a reminder of what started all this.

1 Foghorn Leghorn is a cartoon character that appears in Looney Tunes and Merrie Melodies cartoons and films from Warner Bros. The character starred in 29 cartoons from 1946 to 1964 (Golden Age of American Animation); 2 Looney Tunes is an American series of animated comedy short films produced by Warner Bros. from 1930 to 1969.
1 Foghorn Leghorn is a cartoon character that appears in Looney Tunes and Merrie Melodies cartoons and films from Warner Bros. The character starred in 29 cartoons from 1946 to 1964 (Golden Age of American Animation); 2 Looney Tunes is an American series of animated comedy short films produced by Warner Bros. from 1930 to 1969.