The CPC is asking for direct payments of $20 per hog to help producers weather the COVID-19 storm
By Jackie Clark
Staff Writer
Farms.com
The Canadian pork industry is under strain due to COVID-19-related processing plant closures and other market challenges. The Canadian Pork Council (CPC) is asking for a cash injection from the federal government to help support producers through this challenging time.
“COVID-19 has made a bad situation worse for our hog producers … disrupting supply chains and driving down the price of hogs. The market devastation caused by COVID-19 will only increase as the pandemic drags on,” said Rick Bergmann, Manitoba-based chair of the CPC, during an April 23 press conference.
“Market returns don’t even cover the cost of operating the business,” he added.
With the panic buying at the beginning of the COVID-19 response, pork markets initially looked like they might strengthen. However, the boon was short-lived, and the shift away from restaurant and food service sales, along with processing plant closures, have made the situation worse, Bergmann explained.
“Market prices in Canada have fallen by a minimum of 30 per cent since the start of this crisis,” he said. “Producers across our country expect to lose approximately $675 million. Individual producers are expecting to lose about $30 a hog,” and in some regions more than $50 per animal.
Bergmann acknowledged that the government has been attempting to show some support for agriculture, however “the support is wholly inadequate … we are facing a cash flow crisis that’s impacting our viability,” he said. “Without emergency support, (pork producers) won’t be in a position to repay their existing debt, let alone any additional debt taken on during the crisis.”
The challenges faced by producers will lead to tough decisions, such as aborting sows and welfare slaughter, Bergmann added. In Eastern Canada some hogs have already been euthanized due to strained processing capacity.
A set-aside program, as has been proposed for beef production, isn’t possible in the swine industry.
“Our product is one that, when it’s ready for market … it has to move,” Bergmann said.
“Hog farmers, consumers, public service and elected officials all agree that this is an unacceptable situation, and that something must be done,” he added.
So, the Canadian Pork Council is asking for the federal government to use existing administrative tools to provide a direct payment of $20 per hog (and adjusted values for piglets) to help producers through the crisis, said René Roy, Quebec-based first vice-chair of the CPC. It needs to happen in a matter of days, said Roy.
“Right now we need an immediate cash infusion,” Bergmann said. The CPC is waiting on a strong signal from government that they are truly ready to support pork producers.
Processing plant closures will cause long-term problems for producers. “It will take several weeks, even months, to recover the backlog,” Roy said.
Pork producers understand business risk and can weather the ups and downs of the industry, Roy and Bergmann explained. But the current situation is more than normal market challenges.
“The support that we are requesting from the government is not to recover the loss,” it’s just to be able to survive the crisis, explained Roy.
The pork industry needs the immediate financial support “to help our producers pay their bills, pay their employees, look after the flow of their farm and, again, continue to secure food supply for all Canadians,” Bergmann said.
The viability of farms and stability of our food supply is threatened, said Bergmann. He has had many conversations with government officials and is optimistic that a strong signal of support will come soon.
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