December 02, 2003
Canada Hog Producers Face With Unprofitable Margins
Over the past couple of months, hog producers in Canada have been working with unprofitable margins, and this situation is likely to persist, according to Canadian Resource News.
Resource News said industry sources peg current losses at some C$18-C$28 per market hog (about $13.85-$21.60).
The fact that the Canadian dollar is so strong against the U.S. dollar has played a part.
"Hog prices in the U.S. are generally quite reasonable, possibly even profitable for those producers...but because the Canadian dollar has rallied some 22% in a very short period of time, that hike has come right off the revenues and in turn made Canada's hogs uncompetitive," Tyler Fulton, director of risk management for Manitoba Pork Marketing said.
The Canadian dollar would have to drop back to the 70 US cent level before hog producers would be at a breakeven point, an economist told Resource News. The loonie traded at 77 US cents Friday morning, a new ten-year high.