September 23, 2003
Canadian Hogs Exports To U.S. Up
U.S. imports of Canadian slaughter hogs have increased sharply since June, said a report published by the United States Department OF Agriculture's (USDA) Economic Research Service (ERS). The Livestock, Dairy and Poultry Outlook noted that live hog imports for the period June-August 2003 had increased 48 percent over the same period of 2002.
USDA says larger imports of Canadian slaughter animals is consistent with Canadian slaughter data, which indicate that Federal Slaughter for June-August is more than 7 percent lower than in the same period of 2002. Canadian data also suggested that slaughter facilities in the western provinces have reduced slaughter numbers the most. For June-August 2003, Manitoba's slaughter is more than 19 percent lower than last year, and Saskatchewan's slaughter was 11 percent lower than last year.
"An important reason for lower Canadian slaughter - and thus a greater supply of exportable hog - could be weak demand for pork by Canadian consumers, since the onset of the BSE situation in late May," says ERs "It appears that Canadian consumers have increased their consumption of domestic beef as a sympathetic response to the plight of the Canadian beef industry."
USDA says lower Canadian pork prices led to lower packer margins, causing suppliers to switch to slaughtering for higher prices in U.S. markets. "Larger imports of Canadian slaughter hogs will likely persist, until supply and demand balance has been achieved in Canada, and more normal pork consumption rates resume," they add.
Furthermore, weak consumer demand for pork products in Canada appears to have created attractively priced products for US importers. Canadian pork products increased 14 percent over the same 2 month period last year in spite of a lower US dollar for imports in June and Jul. The first 7 months of 2003 saw Canadian pork imports increased 16 percent over 2002, the report added.