US swine imports from Canada decline further; off 18% year-to-date

US live swine imports from Canada for the year through mid-February are down about 18% from the same period a year ago, extending the downtrend that began on a monthly basis in the spring of 2008.

North American hog producers have suffered huge financial losses during the past 30 months due to a combination of record-high feed costs, low prices and reduced demand caused by the world economic crisis.

For Canadian producers, the situation was made worse by unfavourable exchange rates in shipping feeder pigs and slaughter hogs to the US along with the implementation of the US Country of Origin Labelling Law. Both have contributed to further swine-herd cutbacks in Canada, according to analysts and industry participants. The Canadian government also implemented a sow buyout program in early 2008 aimed at reducing production, supporting hog prices and easing producers' losses.

Imports of feeder pigs from Canada for the year to date as of February 13 stood at just under 600,000 head, down 16% from a year ago. Imports of barrows and gilts directly for slaughter were at nearly 71,000 head, off 28% from the same period in 2009.

Market analysts have projected swine imports for all of 2010 to be 10%-15% below a year ago and total around 5.2 million to 5.5 million head. This would be down nearly 50% from the record set in 2008 at nearly 10.2 million.

Canadian-origin hogs in 2009 made up about 5.8% of US slaughter. Smaller imports are supportive for prices since packers will compete for the reduced supplies that are available.