October 30, 2003


Canada Likely To Emerge As World's Largest Pork Exporter; Hog Exports to US Up 24% in Jan-Sep

LOWER HOG INVENTORY REFLECTS HIGHER LIVE HOG EXPORTS:  Statistics Canada's October 1, 2003 hog numbers show that the total Canadian swine inventory fell to 14.4 million hogs, down 1.2% from July 1 and 3.3% from the level of October, 2002.  However, despite the decline in the total inventory, the size of the breeding herd remained about the same compared with July 1 and, in fact, increased 2.9% compared with October 2002. This structural change in the industry is linked to rising exports of feeder pigs to the United States.  Canadian exports of live hogs to the United States, both feeder and slaughter, rose an estimated 24% in the first nine months of 2003, compared with the same period of 2002.  Feeder pig exports account for about 70% of the total.


MANITOBA PROVIDES C$3 MILLION LOAN TO RE-ESTABLISH HOG OPERATION AT NEEPAWA:  Manitoba Industry, Trade and Mines Minister MaryAnn Mihychuk has announced that the province is providing a C$3 million secured, repayable loan to Springhill Farms to assist the company in re-establishing its hog processing operations in Neepawa.  Springhill Farms, an important hog processor in Manitoba, temporarily curtailed production in July 2003 (citing poor profitability linked to Japan sales and to the general appreciation in the Canadian dollar in 2003) with a resulting increase in live slaughter hog exports to the United States.  The plant's capacity is approximately 18,000 hogs per week.  Normally, the plant slaughters hogs for shipment to a cutting plant in Winnipeg owned by Maple Leaf Foods, Inc. 


STRONGER HOG PRICES FOR PRODUCERS; ADVANCING PORK EXPORTS:  Statistics Canada reports that Canadian hog prices and price prospects have been improving following a collapse in the fall of 2002, although they remain well below the higher prices experienced as recently as 2001. The September 2003 price was about 25% higher than the price in September 2002, which was the lowest point in that year.   The closure of the US border to Canadian beef on May 20 was also a factor.   U.S. beef prices rose as supplies in the U.S. tightened, boosting pork prices at the same time.  Canada will likely emerge as the world's largest pork exporter this year.  Total Canadian exports of pork in the January to August period of 2003 increased by almost 20% from the same period a year ago.  Exports to markets in the same eight months of 2003 are up 14% to the United States, 29% to Japan, 38% to Australia and 86% to Mexico.  Sales to South Korea and Russia were below year earlier levels.



Source: USDA