October 26, 2007


Rising feed costs put down Canada's hog population despite higher pork demand



Canada's hog inventories fell 3 percent totalled 14.437 million head as on Oct. 1, down from 14.900 million the same time a year ago Statistics Canada on Thursday revealed.


The government agency said hog inventories tumbled for the second consecutive quarter despite high international demand for Canadian hogs and pork.


Soft slaughter prices and high feed costs continued to adversely affect the hog industry in Canada.


Hog prices continued to be soft as they have been since 2005 in part because of a stronger Canadian dollar, the agency said.


Although prices have improved modestly in recent months, they are still well below those recorded in the same period in 2005. Prices as of August were about 4.6 percent higher than the same period in 2006, but still 11.6 percent below the 2005 average.


Canadian farmers, meanwhile, exported hogs principally to the US at a record pace, as an estimated 7.2 million hogs were shipped during the first nine months of 2007, Statistics Canada said. This surpassed the previous record established in 2006.


With rising feed costs, the weaner export market remains attractive to Canadian farrowing producers.


The record exports combined with recent strong prices helped push hog farm cash receipts up during the first half of 2007, Statistics Canada said.


During this period, they climbed to CAN$1.8 billion (US$1.86 billion) , rising 7.8 percent from the same period a year ago.


Hog slaughter in Canada slipped 2.9 percent in the first nine months of 2007 from the same period in 2006, the government agency said. Domestic slaughter rose steadily from 1999 to 2004, reaching a record high of 22.9 million head in 2004. Since then, levels have been declining. Statistics Canada said this decline coincides with a shrinking domestic hog slaughter capacity.


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