[tdb_mobile_menu inline="yes" icon_color="#790000" icon_size="eyJhbGwiOjIyLCJwaG9uZSI6IjI3In0=" icon_padding="eyJhbGwiOjIuNSwicGhvbmUiOiIyIn0=" tdc_css="eyJwaG9uZSI6eyJtYXJnaW4tbGVmdCI6Ii0xMyIsImRpc3BsYXkiOiIifSwicGhvbmVfbWF4X3dpZHRoIjo3Njd9" menu_id="" icon_color_h="#222222"]
[tdb_header_logo align_horiz="content-horiz-center" align_vert="content-vert-center" media_size_image_height="99" media_size_image_width="300" image_width="eyJwb3J0cmFpdCI6IjE4NiJ9" text="NewsPaper" f_text_font_family="eyJwaG9uZSI6IjUyMSJ9" f_text_font_transform="eyJwaG9uZSI6InVwcGVyY2FzZSJ9" f_text_font_weight="eyJwaG9uZSI6IjkwMCJ9" show_image="eyJhbGwiOiJub25lIiwicGhvbmUiOiJibG9jayJ9" tagline_align_horiz="content-horiz-center" f_tagline_font_family="394" f_tagline_font_weight="" text_color="#ffffff" ttl_tag_space="eyJhbGwiOiItMyIsInBvcnRyYWl0IjoiLTIifQ==" tdc_css="eyJhbGwiOnsiZGlzcGxheSI6IiJ9fQ==" f_text_font_size="eyJwaG9uZSI6IjIwIn0=" f_text_font_spacing="eyJwaG9uZSI6IjEifQ==" image_retina="52" show_title="eyJwaG9uZSI6Im5vbmUifQ==" show_tagline="eyJwaG9uZSI6Im5vbmUifQ==" img_txt_space="eyJwaG9uZSI6IjIifQ=="]
[tdb_mobile_search inline="yes" float_right="yes" tdc_css="eyJwaG9uZSI6eyJtYXJnaW4tcmlnaHQiOiItMTkiLCJtYXJnaW4tYm90dG9tIjoiMCIsImRpc3BsYXkiOiIifSwicGhvbmVfbWF4X3dpZHRoIjo3Njd9" icon_color="#790000" icon_color_h="#222222"]
[tdb_header_date inline="yes" tdc_css="eyJhbGwiOnsibWFyZ2luLXRvcCI6Ii0xIiwibWFyZ2luLXJpZ2h0IjoiMzIiLCJkaXNwbGF5IjoiIn19" date_color="#ffffff"]
[tdb_header_logo align_horiz="content-horiz-center" align_vert="content-vert-center" media_size_image_height="99" media_size_image_width="300" image_width="eyJwb3J0cmFpdCI6IjE4NiIsImFsbCI6IjIwMCJ9" f_text_font_family="521" f_text_font_size="eyJhbGwiOiIzOSIsInBvcnRyYWl0IjoiMzUifQ==" f_text_font_transform="uppercase" f_text_font_weight="900" show_image="" tagline="dGhlJTIwYXJ0JTIwb2YlMjBwdWJsaXNoaW5n" tagline_align_horiz="content-horiz-center" f_tagline_font_family="394" f_tagline_font_weight="500" f_tagline_font_size="9" tagline_color="#000000" f_tagline_font_spacing="normal" text_color="#000000" ttl_tag_space="eyJhbGwiOiItMyIsInBvcnRyYWl0IjoiLTIifQ==" f_text_font_spacing="1" inline="yes" tdc_css="eyJhbGwiOnsicGFkZGluZy10b3AiOiIxMyIsImRpc3BsYXkiOiIifX0=" image="52" image_retina="52" show_title="none" show_tagline="none"][tdb_header_search results_msg_align="content-horiz-center" image_floated="float_left" image_width="30" image_size="td_324x400" show_cat="none" show_btn="none" show_date="" show_review="none" show_com="none" show_excerpt="none" show_author="none" meta_padding="2px 0 0 15px" art_title="0 0 5px" all_modules_space="20" inline="yes" tdc_css="eyJhbGwiOnsibWFyZ2luLXRvcCI6IjkiLCJkaXNwbGF5IjoiIn0sInBvcnRyYWl0Ijp7Im1hcmdpbi10b3AiOiIwIiwiZGlzcGxheSI6IiJ9LCJwb3J0cmFpdF9tYXhfd2lkdGgiOjEwMTgsInBvcnRyYWl0X21pbl93aWR0aCI6NzY4fQ==" float_block="yes" form_align="content-horiz-right" icon_size="eyJhbGwiOjIwLCJwb3J0cmFpdCI6IjE1In0=" icon_padding="eyJhbGwiOiI0IiwicG9ydHJhaXQiOiIzLjUifQ==" icon_color="#790000" icon_color_h="#222222"][tdb_header_menu main_sub_tdicon="td-icon-down" sub_tdicon="td-icon-right-arrow" mm_align_horiz="content-horiz-center" modules_on_row_regular="20%" modules_on_row_cats="25%" image_size="td_324x400" modules_category="image" show_excerpt="none" show_com="none" show_date="none" show_author="none" mm_sub_align_horiz="content-horiz-right" mm_elem_align_horiz="content-horiz-right" inline="yes" mm_align_screen="yes" f_elem_font_size="eyJwb3J0cmFpdCI6IjExIiwiYWxsIjoiMThweCJ9" elem_padd="eyJwb3J0cmFpdCI6IjAgOXB4In0=" menu_id="1261" tds_menu_active="tds_menu_active1" f_elem_font_line_height="eyJhbGwiOiI4MHB4IiwicG9ydHJhaXQiOiI1MnB4In0=" tdc_css="eyJhbGwiOnsibWFyZ2luLXRvcCI6IjkiLCJwYWRkaW5nLWxlZnQiOiIyNXB4IiwiZGlzcGxheSI6IiJ9LCJwb3J0cmFpdCI6eyJtYXJnaW4tdG9wIjoiMCIsImRpc3BsYXkiOiIifSwicG9ydHJhaXRfbWF4X3dpZHRoIjoxMDE4LCJwb3J0cmFpdF9taW5fd2lkdGgiOjc2OH0=" more="yes" text_color="#790000" tds_menu_active1-line_color="eyJ0eXBlIjoiZ3JhZGllbnQiLCJjb2xvcjEiOiIjNTg1OTViIiwiY29sb3IyIjoiIzU4NTk1YiIsIm1peGVkQ29sb3JzIjpbXSwiZGVncmVlIjoiLTkwIiwiY3NzIjoiYmFja2dyb3VuZC1jb2xvcjogIzU4NTk1YjsiLCJjc3NQYXJhbXMiOiIwZGVnLCM1ODU5NWIsIzU4NTk1YiJ9" f_elem_font_family="84" f_elem_font_weight="500" f_elem_font_transform="capitalize" tds_menu_active1-text_color_h="#790000"]

Spain – Riding High

0

Pork Commentary, March 9th, 2020
Jim Long, President-CEO, Genesus Inc.

Spain last week reached a record high in hog prices at 1.54 euro a kilogram liveweight (79₵ U.S. lb. liveweight).  Its ability to push exports to China is really paying off. 

  • Spain’s pork production in 2019 was 4,627,179 tonnes up 2.13% from 2018. 
  • In 2019, Spain was the leading E.U. exporter of pork and pork products, with a total of 1,183,750+ (869,540+ in 2018), and doubled its exports to China (668,780+ vs 315,140+)

In 2019, the whole of the European Union exported 4,735,210 tonnes of pork and pork products. An increase of 20% (800,000-tonne increase). Of this China took 2,419,490 tonnes,  almost double 2018. When we look at China-E.U. imports, it’s about 46,000 tonnes a week in 2019.

The January 2020 U.S. exports to China-Hong Kong, indicates 97,002 metric tonnes. A year ago 26,744 (+361%). Obviously, U.S. exports going in the right direction. Our farmer arithmetic tells us that China-Hong Kong exports in January equal about 1 million market hogs.

January’s total U.S. exports were 273,603 metric tonnes, up from last year’s 201,835 metric tonnes. The difference of 72,000 tonnes is about 700,000 market hogs. Roughly the increase in U.S. hog marketings in January from a year ago.

A year ago 53-54% market hogs were 51.20₵ lb. last week 56.44₵ lb. In our opinion, the increase in exports has supported hog prices to the level they are. We certainly don’t need more hogs to be produced and continue to hope export levels push higher.

Who the heck knows how big a sustainable deal will be Coronavirus (COVID-19). We all lived through Swine Flu. Big story, then went away.

We expect that Tyson-JBS have now got their system free of Ractopamine. This should increase exports to China as they have about 170,000 hogs per day. This in itself should increase in our opinion 10,000 tonnes a week to China. We do not believe either company would take out Ractopamine, or its consequences in production without thinking they could move 5,000 tonnes a week to China.

China’s hog price last week averaged 37 RMB/kilogram ($2.40 U.S. liveweight a lb.). Certainly a sign there is still a pork shortage and consumer demand is strong. There are logistics issues due to the Coronavirus (COVID-19), but when there is huge profit potential and  real need for food we expect that profits and need will accelerate logistics.
 

Mexico 

Last week we visited Mexico and talked to many producers.  Like much of the world, the Coronavirus (COVID-19) has disrupted the supply chain. This has created a degree of uncertainty.

We were in the North-west region of Mexico which is Mexico’s heartland of Asian exports. Pork quality is a big issue due to quality demands of the export market. Producers we talked to hope the U.S. can increase levels of exports to Asia so the U.S. will have less to send to Mexico.

Everyone in North America is hoping that the Phase 1 US-China agreement of $40 billion in China Ag purchases includes massive levels of pork purchases.

Context:

Not to minimize the Coronavirus, but put into context of 1.4 billion people living in China.  

  • 260,000 people die a year in vehicle accidents in China, (5,000 a week).
  • The latest Coronavirus (COVID-19) total death toll in China – 3,097.

Let’s hope for everyone’s sake this too will pass

Jim Long (center) with Miguel Davalos Jr. (left) and Miguel Davalos (right) from Genesus Mexico
Genesus News

Genesus
Customer Testimonials

Riverview, MT, USA

“Genesus genetic program works very well for us. Sows produce large uniform litters with good birth and wean lots. Having a good appetite in lactation helps breed back. In our system having an animal with a high immunity sure helps. 

Genesus boars produce fast-growing pigs to market with low mortality. The boars are easy to work with and are willing workers. Carcass is excellent along with meat quality.”

Springwater, MT, USA

“We at Springwater Hogs, like the Genesus animals. Sows eat well, milk well, breed back good. The sows wean heavy pigs of uniform size, with low mortality. Boars perform well, are really good to work with. Weight are good and mortality from wean to 290lbs is 1.98%, which we think is very good. Pigs grow well, convert well and finish off well. The service is really good. We are happy with Genesus.”

For more Genesus client testimonials click here 

What’s in a Name?

0

Pork Commentary, March 2nd, 2020
Jim Long, President-CEO, Genesus Inc.

We all can remember that the Swine Flu outbreak had nothing to do with Swine, but it certainly hurt pork demand. We have lived through Swine Flu, SARS, MERS, Y2K (all computers were going to quit on January 1st, 2000).

Thank goodness the current Coronavirus (COVID-19) problem is not called swine flu. All you have to do is look at the following data on a survey of 737 people re Corona Beer.

The Survey- conducted by 5W Public relations noted:

  • 38% of beer drinkers claimed they would not buy the Mexican beer Corona under any circumstances while the virus spreads worldwide
  • 14% of those queried said they regularly drink Corona beer but would now not do so in public.
  • The confusion continued as 16% of those surveyed said they weren’t sure whether the Coronavirus was related to beer.

Appears to be a lot of confusion and lack of knowledge in some parts of population. Next week we are going to Mexico on business. Probably will risk it and have a Corona.

Observations 

We all have seen the big drop in U.S. Stock Market and lean hog futures. So far during the Coronavirus (COVID-19) break, U.S. Exports have held.

  • A week ago 42,000 metric tonnes up 18% from the week before.
  • Since the 1st of January U.S. Pork Exports are up 91% year over year. 
    • 2019 =158,043 YTD
    • 2020 = 302,000 YTD.  An increase roughly of 20,000 tonnes a week.
    • Hog slaughter is up about 200,000 a week year to date.
    • The export increases are about equal to the increase in hog production.  
    • China up 400%,
    • Mexico up 57%,
    • Japan 108%.

It’s really, really good to see jump in exports.

Last year this time 53-54% lean hogs were 51.85₵ lb., now they are 55.21₵ lb. A year ago lean hogs went to 75₵ lb. by the first part of April. If exports continue as is and seasonal hog slaughter declines, maybe we will see the same this year.

The wildcard is Coronavirus (COVID-19) but when we look at Global Hog price, we see mostly increases in the last week. In South Korea, which has been hit by Coronavirus (COVID-19) market hogs have gone from January 21st being 89.49₵ U.S. liveweight a lb. to $1.57 a lb., on February 27. Not exactly declining.

We expect consumer behavior will slow purchasing of non- essential items but food (pork) will not see much shortfall in demand.

In the misery loves company front; Beyond Meat (Fake Meat) lost nearly 20 per cent last Friday. In valuation Peak price of shares were $240 last July. They have now fallen below $100. About $1 billion has been lost in stock value. Current stock value valuation is 221 times expected earnings. At some point someone better eat the stuff.

Focus Group – My son cooking at McDonald’s

  • 1 out of 100 are Beyond Meat Burgers. At some point you need to sell something or there is no future.

As an industry our best answer to fake meat is to work to make a better tasting product. 

  • More marbling in our pork will deliver better taste. 
  • Taste drives demand. 
  • Making a better tasting product only makes sense.

Some parts of the meat industry are starting to get it!

At Genesus we have had a concentrated plan to develop better tasting pork for over twenty (20) years.

If every American ate one more meal of pork a month it would be equivalent to 7 million hogs a year.

Genesus News
Article Source: Danish agricultural newspaper “LandbrugsAvisen
Written by Einar Bo Thomsen on January 18, 2020
Article has been translated to English from Danish
 
Interview with Jørgen Lindberg – Director, Scandinavian Farms-China

Scandinavian Farms Drops Danbred and chooses Genesus

It will be pigs from Canadian Genesus, who will play the lead, when the major reconstruction of the Danish-owned Scandinavian Farms Pig Industries starts in China.

Jørgen Lindberg, Director of Scandinavian Farms Pig Industries, Lianyungang, China.

You have had pigs from DanBred since you started in China in 2013. Why do you now switch to Genesus?

‘It is an important decision when choosing, which genes to build your herd on. Therefore, we have examined the market and the various suppliers very thoroughly. Overall, we think we get the best solution with Genesus, both when we look at the agreement and the terms, and when it comes to the pigs we get from Genesus.”

Were you not satisfied with DanBred’s pig?

“Yes – the pigs from DanBred have the best genes in the world, and it went well. We had both a nucleus herd with 1,600 DanBred sows that we owned together with DanBred, and a production herd with 14,000 sows and the production of 350,000 slaughter pigs annually. But we have learned that pig production in China is not the same as in Denmark. We cannot expect our employees out here to manage the pigs as we are used to in Denmark. That is why we are now switching to pigs that do not need near the same thorough care to produce good results”

What is it that the pigs from Genesus can?

“With the Genesus sows we get about 16.5 piglets per litters compared to DanBred’s 17-18 piglets. In contrast, the birth weight of the Genesus pigs is quite a bit higher and the pigs are stronger. In Chinese conditions, we believe that it is an advantage with fewer, but in turn stronger piglets, which easier will get all the way to slaughter. As another important factor, feed is 60 percent more expensive in China than in Denmark. Therefore, it is important that the pigs are strong from birth so that they utilize the feed better and reach the slaughter weight faster”.

Genesus is honoured that Danish-owned Scandinavian Farms has chosen our Genetics. We believe the preceding article summarizes the advantages of Genesus.

For more Genesus client testimonials click here 

The right to farm is under fire

0

By Andrew Heck

What would you do without your farm? It is most likely your primary source of income and your home. Your family might have lived on that land for generations. It might even be inconceivable to you that life would ever look different.

When we think of the reasons why producers may become dispossessed, what typically comes to mind is financial ruin. In late 2018, when Canadian pork prices were at decade lows, some producers, unfortunately, made the difficult decision to shut down their operations. In other, rarer cases, the banks came knocking. Either situation is far from ideal, but these are not the only situations in which a producer could have his livelihood taken away.

In a modern world where the wants of a growing, predominately urban public trump the needs of producers, sadly, farmers often lose. Old MacDonald had a farm, until social pressures drove him under, it would seem.

North Carolina producers feel the heat

Andy Curliss, CEO, North Carolina Pork Council takes environmental stewardship seriously. He is shown here in January 2020 standing on a covered digester used to produce renewable energy at a hog farm in his state.

During a breakout session at the 2020 Banff Pork Seminar, Andy Curliss, CEO, North Carolina Pork Council, brought forth a handful of public issues facing producers in his state.

One such issue was highlighted in a 2018 article published in the North Carolina Medical Journal, which suggested an increased risk of mortality in communities associated with confined animal feeding operations. The study was widely distributed and manipulated by agenda-driven agriculture adversaries, but it was also challenged by a researcher at the University of Minnesota, who effectively demonstrated the limitations of the study.

The data, too, supports a different conclusion. As an example, in North Carolina’s two counties that account for nearly half of its pork production, neither of those counties is among the top 25 per cent of counties with the highest mortality rate across the state.

Another studied cited hog barn odour as a potential cause of asthma for school-aged children. Even the data used in the study appears to contradict this claim, as children attending school within a two-mile range of any farm had no greater instance of respiratory problems compared to children attending schools more than two miles away. As with the study on mortality, researchers in Iowa and North Carolina raised objections.

Such instances of baseless complaints lodged against farmers are not without consequence. There are many examples of how such studies are taken out of context by activists and mainstream news media to support a narrative that confirms the biases of those who oppose modern farming.

Even before the North Carolina studies on mortality and odour, other nefarious influences had contributed to a poor public image for the industry. Predictably, much of this campaign was driven by disruptive people, but it required the public support, media platform and legal recourse to become truly devastating.

Duplin County becomes a tinderbox in need of a spark

Central to the odour controversy is the practice of spraying treated lagoon manure on fields. In North Carolina, the method was banned at new livestock operations in 1997. For grandfathered operations, the practice continues to this day.

The timing of the ban was conspicuous, given that many newly built operations were appearing near a golf course where the U.S. Open was hosted in 1999. A long-standing, effective practice of manure disposal was eliminated to satisfy the desires of the professional sports and entertainment industry.

Payne Stewart during the fourth round of the 1999 U.S. Open Championship held at Pinehurst Resort and Country Club No. 2 Course in Pinehurst, N.C., Sunday, June 20, 1999. (Copyright USGA Museum/J.D. Cuban)

Households in Duplin County have a median annual income of $36,679, which is $25,258 less than the median annual income of $61,937 across the entire country, and $13,641 less than the median of $50,320 across the state. Compared to other counties, Duplin has an unusually high number of residents working in agriculture. The median property value in Duplin County was $88,800 in 2017, which is two-and-a-half times smaller than the national average of $229,700. Interestingly, the home ownership rate is 69.7 per cent, which is higher than the national average of 63.9 per cent.

Historical systemic racial division and poverty play an important role in understanding Duplin County’s social and political affairs, and these things should not be overlooked. But for the full picture to come into focus, it is necessary to examine the issues more closely to determine which factors and influential players are responsible for generating the friction. Often, the malicious intentions of bad actors can be found at the root.

The increased presence of agriculture and higher rate of home ownership suggest that this area is ripe for a potential conflict regarding land use. That conflict has been found in the less-than-glamorous side of animal agriculture. From the perspective of producers, learning to accept the unflattering reality of hog production is simply necessary in this line of work. It is how producers make their living and provide food for those who would likely be incapable of doing so themselves. For a misinformed or ill-motivated segment of the population, that often-unspoken reality becomes an easy target.

Joey Carter fights the blaze valiantly

Following an exploration of issues broadly facing North Carolina producers, Curliss told the harrowing tale of Joey Carter: a producer who, for more than three decades, met and exceeded North Carolina state regulations for hog farmers and was known to constantly upgrade his operation, based on considerations of animal welfare and the environment. In addition to hogs, he raises cattle and is active in his local cattlemen’s association. Even before and during his time as a producer, Carter served as a police officer (now retired) and volunteer fire chief for the town of Beulaville. He is, by many people’s objective standards, a model producer and citizen.

In July 2018, a North Carolina jury awarded more than $25 million in a lawsuit against Smithfield Foods – the world’s largest pig and pork producer, which owns 500 farms in the U.S. and contracts with another 2,000 independent operators in the country. In total, there are 26 federal lawsuits affecting 86 farms, filed by more than 500 plaintiffs living near those farms in eastern North Carolina.

“The lawsuits are a serious threat to a major industry, to North Carolina’s entire economy and to the jobs and livelihoods of tens of thousands of North Carolinians,” said Keira Lombardo, Smithfield senior vice president, in a statement.

At the time, Carter was a contract finisher for Smithfield. Carter’s farm was one of those targeted by the lawsuits. Rather ironically, one of the suit’s plaintiffs even lives on property that was voluntarily subdivided from the family’s plot by Carter’s father, purchased and developed five years after Joey had already built two of seven total barns that made up his total operation. To date, the same land Joey Carter’s father started farming several decades ago has been home to four generations of the Carter family.

A five-year-old boy leaves a rally and press conference in support of families affected by the lawsuits, in July 2018, held at Joey Carter’s farm. Hundreds gathered to show support for the affected farmers. © The News & Observer, Raleigh, U.S.

Complicating the matter further was the imposition of a gag order against the farmers who were being targeted by the lawsuits. Rather incredibly, only representatives of Smithfield were allowed to testify in court, and public comment on the lawsuits by defendants was effectively banned.

“It’s been kind of tough knowing the relationship and how the community was before this all started, and how it is today,” said Carter, in a September 2018 interview with the North Carolina Farm Bureau. “It’s really driving a wedge between the farmers and a lot of people in the community, which it shouldn’t.”

Partly owing to the demographics of Duplin County, the debate over the smell of hog manure and detection of fecal bacteria (generated by a white farmer) on nearby homes (of black residents) has, in some ways, amplified existing tensions and provided a platform for a wider discussion on social issues.

The phenomenon is made clear by the fact that the lawsuits against Smithfield were created by out-of-state lawyers who chose to seek mostly African-American plaintiffs living near Smithfield farms, which represents a statistical anomaly, considering the two-to-one, white-to-black ratio of residents in these areas, according to U.S. census data from 2017. Rather than seeking to better their communities by urging improvements be made to area farms, plaintiffs sought financial compensation alone.

Suffice to say, the heart of this dispute goes well beyond what any producer is prepared to tackle on his own, and while social license should be the concern of every producer, it is disheartening to think the problem is being addressed, however adequately or inadequately, through lawsuits and legislation, rather than stepping back and working for a community-based solution that benefits all.

“You’ve got to stay positive to survive and get thought it,” said Carter. “It’s going to be alright; it’s just a bump in the road. In the end, I really think somebody else is in charge—somebody higher up—and we’re going to be fine.

“The time we’re in, I think nobody’s safe—whether you’re in the hog business, chicken business, turkey business, cow business. I just don’t know what it’s coming to.”

Joey Carter (left) shakes hands with an official from the U.S. Department of Agriculture, following Hurricane Florence in 2018. Manure lagoons in this part of the U.S. can become environmentally hazardous in severe weather, if not managed appropriately.

Lawsuits have farmers and allies seeing red

In January 2020, the U.S. Court of Appeals heard arguments from Smithfield’s law firm against the controversial nuisance lawsuits, citing seven serious errors that resulted in an unfair and improper trial. The U.S. Court of Appeals previously heard arguments against these lawsuits in September 2018, during which time the farmer gag order was harshly criticized as being unfair.

Leading up to the January 2020 appeal, the North Carolina Pork Council joined forces with the U.S. National Pork Producers Council and other partners to file an amicus brief in support of Smithfield’s appeal.

The appeals process was undertaken with the goal of reversing the punitive damages or ordering a new trial. Rulings are typically issued three to six months after oral arguments are heard. At the time of this article’s publication, no ruling had yet been made.

What is burning in Canada?

In 2018, Ponoka County, Alberta, released its Municipal Development Plan (MDP), which included restrictions on the development of new confined feeding operations in a 20,000-acre area where more than a dozen already exist. In addition to being home to many existing confined feeding operations, the region boasts some of the highest-quality soil found anywhere on the prairies for cropland.

The restrictions were detailed in the County’s North West Area Structure Plan, affecting an area immediately adjacent to the Queen Elizabeth II Highway—the major roadway between Edmonton and Calgary. This population corridor includes some of Alberta’s fastest-growing cities and towns, driving demand for non-agricultural use.

Rather than a concern for odour or contamination, as in North Carolina, Ponoka County’s rationale within the plan states, “There is a strong demand for rural residential parcels, and the County is willing to meet this demand provided that it does not damage agriculture or the environment, or impede the logical and economic growth of urban areas.”

Development plans in Ponoka County, Alberta have re-zoned a sizeable portion of land where many intensive livestock operations are found.

Essentially, the County would like to see the land within the defined area zoned for residential properties which are not primarily agricultural. Subdividing this land for acreages would indeed contribute more greatly to the County’s tax base, but at what cost to the community and livestock producers?

In response to the plan’s adoption, the Ponoka Right to Farm Society was formed to challenge the plan in court. The Society now numbers more than 250 area residents who oppose the County’s direction.

“Ponoka County is a farming community, and the municipal government should not be setting up exclusion zones and banning new farms,” said John Hulsman, one of the Society’s board members.

The issue for many producers in the area is that the new restrictions will limit the growth of operations onto new land, which is a concern for multi-generational farm families looking to expand.

In Alberta, confined feeding operations come under the authority of the Natural Resources Conservation Board (NRCB), which has operated since 2002 under the Agricultural Operation Practices Act (AOPA). The legislation is the responsibility of the province’s Ministry of Agriculture and Forestry. Before 2002, licensing and compliance monitoring for confined feeding operations were the responsibility of Alberta’s municipalities, which is one reason why Ponoka County’s imposition of the North West Area Structure Plan is raising eyebrows.

In December 2019, the Ponoka Right to Farm Society launched an appeal with the Alberta Court of Queen’s Bench. At the time of this article’s publication, a court date was set for February 2020.

Hot issues are often complex and diverse

Right to farm is a layered, multi-dimensional topic. Consideration must be given to the region in which challenges are faced and the context surrounding the issue.

In Canada, the matter has not reached the same public proportion as in North Carolina, and the consequences have not been as great. But it is not so far-fetched to imagine that the winds of change could blow the inferno in our direction. Is it only a matter of time?

“Anyone can raise hogs.
 But it takes a near Genius to make money doing it.”

0

Pork Commentary, February 24th, 2020
Jim Long, President-CEO, Genesus Inc.

Global Price Points (LBS. U.S. currently)

“Anyone can raise hogs. But it takes a near Genius to make money doing it.” –  The quote attributed to John Swisher, founder of United Feeds, sums up where we are in the US-Canada hog industry. 

More and more hogs continue to push the supply level beyond profitable hog prices. Over the last few weeks, we have attended five different U.S. industry events.  At them we heard the same sentiments and/or questions: “When is this going to turn’, “I am tired of not making money.” 

Most producers are aware that in just about every country in the world (actually we are not aware of any) producers are making money. Only USA-Canada are not.

Mexico76₵
Russia60₵
Brazil54₵
Spain72₵
China $2.42
Viet Nam $1.52
USA40₵
Canada40₵

You don’t need to be a computer and/or ag-economist to figure that US-Canada is sucking air relative to the rest of the world when it comes to hog price.

There is no doubt that USA-Canada have both suffered from the trade issues both countries have had with China.

Just when things appeared to get somewhat settled, the Phase 1 agreement finalized and Canada was back in China market, the Coronavirus (COVID-19) has hit and disrupted the market. It would be anyone’s guess how Coronavirus (COVID-19) will get sorted, but all indications are the Chinese government is putting a priority on ensuring food movement. That is not to say containers carrying Pork are not being slowed by issues at ports and trucking in China.

Despite these issues, U.S. Pork Exports to China continue near record levels. We would have expected U.S. pork export sales to China to have increased further, if not for Coronavirus (COVID-19).

The Phase 1 commitment of China to purchase more U.S. ag products ($40 billion total) should lead to U.S. pork exports surpassing 25,000 tonnes a week (currently 15,000), or about another 100,000 more hogs a week equivalency. By comparison- Europe shipped about 40,000 tonnes a week to China in 2019.

When we hear that logistics will limit U.S. exports to China, we don’t believe the U.S. logistic capacity can’t match European logistics.

Other Observations

U.S. Sow slaughter is up.

  • January 2019 – 265,300, 
  • January 2020 – 283,100.  (Up 18,000 – same number of slaughter days)

We don’t believe there will be many new sow barns constructed in 2020 from discussions we had over the last few weeks. 

  • Market pricing and packer capacity is braking expansion
  • Has there ever been expansion when producers are losing money?

Purchase of J.H. Routh Packing Co. in Ohio by HK Property Holdings – a joint venture between Holden Farms and Kalmbach Feeds, is another indication of large producers seeing packer margins and wanting to be part of the pork supply chain.

  • We expect the new ownership will increase daily slaughter numbers towards the plant’s capacity (about 4500 a day).
  • As time goes on, we expect further push for producers to want to integrate into packer equation.

Not sure who all reads this commentary, but from the reaction last week it appears Genetic competitors do.  The appointment of the new CEO of Topigs-Norsvin Coop got a lot of laughs in our industry. His previous experience as CEO of a division of deadstock- rendering company- Darling International was found to be funny.

Months and months of search to replace former CEO who went to a Grass Seed company, then to decide a Senior deadstock person is the background you need for the future to drive a Coop Swine Genetic company is interesting. Maybe the search committee motto was:

“It’s easier to give birth then bring the dead back to life.”

Genesus News

Genesus Customer Testimonials

D & S Brassington, United Kingdom

“We started with Genesus Duroc Semen in 2014 and we noticed the piglets were more uniform with a higher appetite and reaching slaughter weights of 85kg (deadweight) 10 days earlier.

We decided to switch 100% to Genesus (maternal and terminal). Today we are weaning more pigs per litter, averaging 10 days less to market and grading has improved.

Choosing Genesus was the best decision for us.”

Fairlane Farming Co., Canada

“Genesus Landrace x York = a true F1 that produces lots of big viable pigs that are fast-growing and become great mothers with very good feed intake in lactation and return to estrus in 5 days or less.
True Genesus F1 x Purebred Duroc = the best pork in the world.  I say this every year, I would recommend Genesus to anybody.”

30.58 PMSY

For more testimonials click here


Genesus Global Market Report  USA, February 2020

0

Allan Bentley, Sales, Genesus Genetics 
abentley@genesus.com 

“Capitalize on confusion”

The pork show season is almost over and we get to visit with a lot of people in the pork industry during this time.

I am going to piggy back off Jim Long’s comments in his commentary about questioning the need for lean hog futures. I don’t know of any comment Jim has made that provoked so much discussion at a pork show.

I believe Jim is correct, algorithm and day traders are capitalizing on the confusion and mixed messages coming out of Washington D.C. and China. Dr. Joe Carr explained it to me as if the fundamentals have become the boundary lines of the football field, and although that may define the basic rules, the traders can run all over that football field in any direction they want.

There is absolutely no fundamental reason hog futures are where they are right now, maybe because traders are controlling the market? I have been quite involved with bankers from Missouri to Minnesota and they too are very disappointed in the lack of response from hog futures.

The fact that 25% of the hog population is gone should be affecting the market in a positive way for producers. Bankers used to use an inelastic number for hog prices of 4, meaning for every 1 percent change in the supply, the price should react the opposite by 4%. I do not need a calculator to tell you that 25% fewer hogs should mean much higher prices then we are seeing today.

Bankers nor market analysts can’t explain why this is happening. They are as confused as anyone in the pork industry. Maybe the Democrats should investigate the trading practices in Chicago instead of President Trump. A very smart man once told me to “capitalize on confusion.”  I am thinking he must have worked in Chicago!

PEDv is starting to pop up sporadically in herds and PRRS is always a problem but these issues probably won’t affect the markets either.  The bottom line is that there is a huge gap of pigs in China and they need to replace that loss.

When will the market be a true barometer for supply versus demand and not what traders think pork is worth?  Again, traders seem to be able to “capitalize on confusion” and the producers are suffering from their manipulation of the Chicago Board of Trade. 

Genesus News

Genesus Customer Testimonials

Country View Farms, NE, USA

“The hardiness of the Genesus females continues to mpress us. We broke with PRRS in January 2019,but it was amaing to see the Genesus animals desire to live ad get through it. The gilts we purchased from Genesus have been great”

Hutterville Farming, AB, Canada

“Little over halfway through the conversion to Genesus animals; and so far we are seeing huge difference in live born (over 1.5pigs extra). Genesus sows areweaning nice even litters easy to manage and good geed intake in lactation. Overall nicely satisfied for now. Salesman 5 stars.”

Coronavirus- China Agriculture

0

Pork Commentary, February 18th, 2020
Jim Long, President-CEO, Genesus Inc.

The China Agriculture Industry and particularly the Swine Industry have been greatly affected by African Swine Fever (ASF) and now the implications of Coronavirus which has restricted people and transport movement. To say it’s a bad situation is best illustrated by the translated key points from the chairman of China Agriculture Association – MR. Xirong Li in an interview with Chinese media.

Translated Key Points from Mr. Xirongs interview:

First:
The obstruction of logistics seriously affects the production supply and the trade of live livestock and poultry. 


Since the outbreak of coronavirus, major public health emergencies have been launched at the first level, resulting in the control of roads and motor vehicles.  As the consequence, the transportation of pigs, young breeding stocks, eggs, poultry meat, feed, veterinary drugs, vaccines, equipment and other production and living related materials are greatly affected. 


Cross province live livestock and poultry sales and transportation links are broken. Live livestock and poultry cannot be transferred between enterprises to meet normal production, and business process is interrupted. 


At present, all or some cities and counties in 27 provinces have closed the live poultry market, and the live poultry in the market cannot be sold. The poultry industry has suffered heavy losses. 


According to the incomplete statistics of the association, it is preliminarily estimated that as of February 12, the loss of poultry industry has reached 15.865 billion yuan (2.25 U.S. billion)


Livestock and poultry industry is a special industry with poor ability to resist market risks. Once the industry is destroyed, the recovery period will be a very slow process.

Second: 

The slaughterhouse cannot be started or the operation is insufficient and affects the production and marketing of livestock and poultry. 


The procedures to reopen the operations of slaughtering enterprises is complicated: the road restrictions on the flow of people, resulta in a shortage of manpower, an so the slaughterhouses cannot start operation, or the operation is insufficient which directly leads to the failure of sales for poultry, commercial pigs, cattle, sheep, rabbits and others. 

Third: 
The production staff is in short supply and the cost is rising. 


Affected by the delay of returning employees and the extreme shortage of labor force, the enterprises cannot complete the established work plan, the production index decreases and so the cost increases.

Fourth: 
Some enterprises are short of working capital and have difficulty in capital turnover. 

Due to the dual threats of ASF and coronavirus, the enterprises have invested heavily in biological safety control and prevention, including the increase of inventory of various materials, thus raising the warehouse cost and plus the new outbreak of coronavirus, which seriously affects pig sales, and the lack of liquidity and difficulties in capital turnover.

Fifth:  
It will affect the purchase of materials, delay the commencement time of new projects and introduction of breeding stocks. 


It is difficult for enterprises to purchase materials for life and epidemic prevention, especially face masks and disinfectants. 

New projects under construction in some enterprises are affected to varying degrees. 

Due to the restriction of personnel flow and road traffic, many enterprises cannot introduce new genetics, which affects the follow-up commercial production.

Given above challenges, the Ministry of Agriculture and Rural Affairs, National Development and Reform Commission, and the Ministry of Transport jointly developed a policy to build the Green Corridor for the priority products including feed products, corn, soybean meal and other feed raw materials, breeding livestock and poultry, piglet and young birds, aquarium fry, livestock and poultry marketing animals, fresh milk, dairy products, fresh aquatic products, chilled and fresh pork, transferal bees, etc. 

We believe Brett Stuart of Global AgriTrends has as good a handle on China’s Swine Industry as anyone anywhere. Here are some comments published in the Western producer by columnist Karen Briere from Brett’s recent talk in Saskatoon Canada:

“Disease is a global market game-changer.”

“The hog market seems to be having a hard time believing what is happening in China”, Stuart said. He called it “irrational.”

The country officially says 40 percent of its sow herd is gone but he estimates it at closer to 65 percent.

“In context, North America has about 6.5 million sows and China just lost 24 million.”

“I look at U.S. hog futures and no one will believe it. We’re not even making money on hogs. They’re pretty suspicious of this, especially the investors.”

“It’s just not there,” Stuart said. “By my math, I say China is going to have about a 24.5 million tonne gap in protein in 2020.”

“Current global pork trade is about eight million tonnes.”

Stuart said “there is nothing that can be produced in the volume China requires to fill the gap. Chinese pork prices are going to stay very high for a long time as a result.”

He added that “China’s claims that it can restore normal pork supply by 2021 is simply propaganda; there aren’t 20 million sows on the global market.”

Topigs Norsvin Appoints New CEO

In the world of Swine Genetics, we pay attention.

Topigs Norsvin after a several month search has appointed Villaume Kal as its new CEO. Mr. Kal replaces Martin Bijl who left in 2019 to join a company selling Grass Seed. 

Mr. Kal is the former CEO of Rousselot, part of Darling Ingredients. Darling Company is where we used to take our deadstock for rendering.

Kind of find it funny, maybe even poetic that a deadstock company is training ground for a swine genetics company CEO. Strange but interesting world. 

Genesus News

Genesus Customer Testimonials

Newport South, MN, USA

“The Genesus Duroc sired pig hits the ground running, the pig finds milk and never slows down. Very easy starting pig, transitions well to pellets and then to grind and mix. They never slow down even in our barn where we move them five times. The pigs never skip a beat and have a very low mortality rate from wean to finish. The Duroc pig can withstand everyday health challenges and is very uniform and finishes in a tight group. This pig has a huge appetite, and it shows to be beneficial through health challenges.    This all starts in the farrowing room thanks to the Genesus F1, she has a big appetite, milks all her pigs and gets them off to the right start.”  

Ferme Durand, MB, Canada

“We are very proud to be associated with Genesus whether it be with the executive or selection team. All are precisely important to our relationship. Pig performance and temperament are second to none – making our care for animals a great joy.”

For more testimonials click here 

The Pork Show welcomes industry to Quebec

By Andrew Heck

Given the high-level nature of The Pork Show, it is no coincidence that the conference is held next door to the Quebec National Assembly (provincial parliament).

With a view of the walls of old Quebec City, and on the doorstep of the province’s National Assembly, guests from around the world gathered at the Quebec Convention Centre for The Pork Show on December 10 and 11, 2019.

Canada’s oldest major city (now more than four centuries old) might seem an unlikely location for a pork conference, but the province is our country’s top pork producer by volume, and it is here that many in the global industry are looking when it comes to innovative production and models for producer profitability.

The annual conference, now in its sixth year, is the largest pork-specific conference in Canada and routinely welcomes more than 1,000 guests from across the pork value chain to participate.

Big names and big ideas dominate the discussion

Vincent Cloutier, Director, Economic Affairs, Quebec Pork hosted the African Swine Fever discussion panel on the first evening of the conference.

The first day of the show featured a panel discussion on African Swine Fever (ASF), with participation by Dr. Aline Dimitri, Executive Director, Animal Health, Canadian Food Inspection Agency (CFIA); Martin Pelletier, a contributor to the Quebec Swine Health Team; and Sylvain Fournaise, Vice President, Food Safety and Technical Services, Olymel.

The second day of the show was kicked off with a presentation by Jean Charest, former Quebec Premier and partner with McCarthy Tétrault LLP. He is a veteran politician with much experience on the side of trade negotiations.

In 1994, Jean Charest was chosen to lead the federal Progressive Conservative Party and in 1998, he became the leader of the Quebec Liberal Party. Charest then broke a 50-year provincial record by winning three consecutive election campaigns in 2003, 2007 and 2008. Charest helped negotiate the Canada-European Union Comprehensive Economic Trade Agreement (CETA), signed in 2016, though only partially in force, and he is currently a director with the Asia Pacific Foundation of Canada.

To Charest, there is an emerging agricultural labour crisis that has been spurred by the aging of populations in the western world, along with the rise of political populism, contrasted by a growing middle class in the developing world that is hungry for meat. Tackling these challenges is exacerbated by political tensions that underly government decision-making.

Jean Charest, former Quebec premier, suggested that geopolitical tensions and domestic political sentiments have profoundly impacted agriculture.

“The rise of nationalism and economic crises in some countries has changed the game forever. It’s the new reality,” said Charest. “These are warning signals. The country that moves fastest to recruit and integrate immigrants will be the one that comes out victorious. Canada is a country of immigrants, and the agriculture sector needs this.”

Brett Stuart, President, Global Agri-Trends presented a global pork market update, and Robert Saik, President, Saik Management Group presented on the future of food trends.

“Try to find a positive movie on Netflix about agriculture—you can’t,” said Saik. “We and our school-aged children are fed fear on a daily basis, and it’s affecting public perceptions of the industry.”

Guests expand their scope of knowledge

After lunch, breakout sessions were hosted on three topic areas: innovation and technology; health and livestock management; and food marketing. Each session included a half-hour presentation from two different presenters, making for a condensed but efficient format.

Breakout sessions were followed by Awards of Excellence, given to one producer and one industry partner that has demonstrated outstanding work in the past year. The awards were presented by André Lamontagne, Minister, Quebec Agriculture, Fisheries and Food and Jean Larose, Executive Director, Quebec Pork.

The winner in the producer category was Ferme Pouvaco Inc., for their efforts to improve animal welfare and environmental practices on-farm. The winner in the industry partner category was the Quebec Pork Development Centre, a centre of expertise that contributes to knowledge transfer activities and research.

To complete the formal portion of the program, Dr. Luc Dupont, Associate Professor, Faculty of Arts, University of Ottawa presented on building an effective business marketing plan, which is part of bridging the gap between public perception and the reality of pork production.

“You’re all doing wonderful things, but this is not enough; you have to tell people,” said Dr. Dupont. “If you don’t take your space, someone else will move in. You have to blow your own horn. Animal activism is a prime example of how the conversation can change shape.”

AQINAC serves Quebec’s feed grain industry

Sébastien Lacroix’s company, AQINAC, is a proud presenter of The Pork Show.

“We believe this event is an important opportunity for the entire industry,” said Sébastien Lacroix, Deputy General Director, AQINAC. “Quebec producers and partners are on the leading edge, and we want to share our expertise with guests, just as much as we want our guests to bring their great ideas to us.”

AQINAC supports more than 200 active and associated livestock and poultry feed grain members in the province, in addition to grain traders and suppliers of goods and services. The organization serves most Quebec producers involved in animal production.

The organization represents an annual production of 4.6 million tonnes of feed equivalents, which are used by more than half of all the province’s producers of hogs, poultry, turkey and eggs. This translates into more than $2 billion in feed sales. Nearly two-thirds of the total volume of Quebec grain passes through institutions that are members of AQINAC.

While the first commercial feed mills appeared in Quebec in the late 1930s, it was not until 1961 that a first group of millers was born. Originally established as the Association for the Expansion and Protection of the Agricultural Industry in Eastern Canada Inc., in 1963, the organization became the Professional Association of Quebec Millers.

In the mid-1990s, the association’s membership became more diverse when it welcomed members of the Quebec Division of the Animal Nutrition Association of Canada (ANAC). To reflect this diversity, and to mark the integration of grain traders, the organization changed its name again in 1996 to become the current AQINAC.

Quebec’s culinary excellence on display

The first evening of the conference featured networking opportunities and the presentation of research posters by Swine Innovation Porc, along with a cocktail reception featuring local beverages, in addition to pork dumplings and pulled pork sliders.

Throughout the event, guests were privileged to enjoy the best of what the province has to offer. The experience was most obvious during the plated lunch on the second day of the conference, which included cuts from the belly of a young, milk-fed pig (porcelet), served with a pepper gravy, bacon-and-cheese mashed potatoes and honey-roasted vegetables. The menu was created by a culinary team that won a competition to have their meal included in The Pork Show’s program.

The second evening of the conference again featured cocktails and networking opportunity, followed by a casual food and beverage tasting event, during which guests were invited to sample the finest of Quebec fare, including charcuterie, hot appetizers and assorted samples of wine, beer and spirits.

Lean Hog Futures Rebound – Somewhat

0

Pork Commentary, February 10th, 2020
Jim Long, President-CEO, Genesus Inc.

The Wild Gyrations in the lean hog futures are best illustrated by the following:

June Lean Hog Futures
January 23    88.175
January 31    75.625
February 7    81.555

The insane drop in a week of over $25 per head has since been followed in a week by a rebound of about half that amount. The word “stable” should never be used in the current scenario of the lean hog futures or maybe even the psyche of many of the US producers.

As we wrote last week, it is bizarre to think Coronavirus would stop Chinese from eating pork or any other meets (not related to bats, snakes, etc.). As our Genesus General Manager in China told us “The only stores open are supermarkets. We go to stores, buy food and sit at home eating.” Point is they aren’t buying cars, apple phones, going to restaurants, etc. Food, yes.

There are reports that travel restrictions had prevented pig and poultry farms from receiving feed. Livestock perished as a result. Last week the Chinese Federal Government put a priority on ensuring food and agriculture products were prioritized in movement with little restrictions.

There are reports that imported pork is backing up at Chinese Ports.  Not enough trucks arriving to take pork to the next destination due to Coronavirus reaction.  We expect this is to get sorted fast. These are some advantages to a command society.

We were with a Chinese Company last week that is a Global Mega Producer.  They are still very optimistic that the Chinese hog price will hold near current levels ($2.39 U.S. liveweight a lb.). 

A reflection of breeding stock demand are these current prices in China.

  • A Duroc bred to a York/Landrace gilt offspring with decent health- $350 U.S. for 50 lb. pig (here we call this a market hog).
  • Maternal AI, $120. U.S. / dose.
  • Terminal AI Duroc, $25 U.S. / dose

Certainly, high price points. Reflects supply and demand of genetics in China and optimism of future hog pricing. China government gave a signal last week of further need for U.S. pork by cutting tariffs by 5%. They will stay in market.

U.S. Pork Exports in the last week of January at 42,000 tonnes, were double from a year ago. So far up 460% to China year to date (YTD), up 62% to Mexico YTD and up 107% to Canada YTD. Mexico and Canada are duty-free to China.  We expect U.S. pork is filling holes in both countries for pork going to China.  It’s a North American market. Any pork leaving is a good idea.

Last week’s average price for market hogs in China was 36.86 rmb/kg. or $2.39 U.S. /lb. ( for a 270 lb. hog= $645).  Go Figure, we should be able to ship pork from here with current market hogs about $122.00 a head 270 lbs.?

Last week we wrote wondering if the Chicago Board of Trade and lean hog futures were really related to the swine industry any more than show pigs. The rest of the world has no lean hog futures and most countries are doing fine without them. We are told about 70% of current lean hog future participants are non-hog farm related. Are these speculators?  Not sure, but, there is a group of people making a living unrelated to the direct participants in the industry. 


Was interesting this past week, we had producer comments wondering too if lean hog futures did anything but create a more volatile market. They also had never thought about that no other pork country had its own “Las Vegas”. 

Our point is, no other major hog producing country has had the extreme reaction in pricing that lean hog futures had the last two weeks.  It’s not anything but harmful to producers.  We sense many producers who invested huge capital resources and are committed to our industry resent their destiny being tied to sharpie speculators that live in New York City and Chicago sitting on gobs of money to run the market up and down.

They don’t care if its hog, orange juice, oil etc.  It’s all about people who make nothing tangible for society, living on speculation.

Genesus News

Genesus Customer Testimonials

Country View Farms, NE, USA

“The hardiness of the Genesus females continues to mpress us. We broke with PRRS in January 2019,but it was amaing to see the Genesus animals desire to live ad get through it. The gilts we purchased from Genesus have been great”

Hutterville Farming, AB, Canada

“Little over halfway through the conversion to Genesus animals; and so far we are seeing huge difference in live born (over 1.5pigs extra). Genesus sows areweaning nice even litters easy to manage and good geed intake in lactation. Overall nicely satisfied for now. Salesman 5 stars.”

Bad Week for Pork Producers

0

Pork Commentary, February 3rd, 2020
Jim Long, President-CEO, Genesus Inc.

To say last week was bad seems like an understatement. When you get to the spot to rationalising “It’s not that bad, I am not living in Syria”.

It appears for some reason lean hog futures traders believe Coronavirus in China is going to have consumers stop eating pork. Not sure where that idea comes from. Is this rationale or just panic by a group driven by the reality and/or fears of margin calls?

On Thursday, January 30, 2020, in China the average price of hogs was 36.32 rmb/kg ($2.31 U.S. liveweight a lb.) steady with the prior week. In our minds, the hog price is an indicator of demand. If hog price holds it means the market is in place. It seems so far the Chinese continue to eat pork (i.e. food).

Europe (Germany & Spain) have been major exporters to China. We thought it worthwhile for us to check where their hog prices went this week from the week before.

  • Jan 29, 2020 Germany 1.85 Euro/kg +1.6%.
  • Jan 30, 2020 Spain 1.424 Euro/kg +0.3%

So far prices are holding.

U.S. pork exports were 43,600 MT. (Jan 17-23), double a year ago. China was 18,620 MT. (the highest week ever) up from 3,000 MT. a year ago.

Exports are strong- Our farmer arithmetic tells us over 200,000 more equivalency hogs were exported this past week compared to a year ago. Price going forward is going to be driven by demand. The number of hogs we have, we have. If exports hold and/or be enhanced we expect no reason domestic pork demand should be lower.

There is a good chance the collapse in lean hog futures will turn around and prices will rebound.

Other Observations:

Sow slaughter the last two weeks has averaged 66,000. Maybe due to Christmas holiday back-up, but if it continues at a pace over 60,000 a week it would tell us to expect some liquidation underway.  The U.S. averaged 57,000 a week in 2019.

The U.S. cattle inventory report last week was bullish. It’s the first by animal report in last 12 reports that showed a decrease in total cattle numbers- down 1%. Maybe a cattle future bump this week will support lean hog futures.  Certainly less beef can be pork price supportive over the coming months.

Brazilian Meat Packers JBS S.A. (Also in USA) and BRF S.A. told Reuters on Wednesday that the coronavirus outbreak in China could boost Chinese demand for their products, including pork. Mainly for food safety issues.

An Article in eFeedLink calls pork, beef, chicken and dairy the big winners in the U.S. – China Phase 1 trade agreement. Premise is to live up to the $40 billion Ag import increase committed by China.


The logical way is to purchase high-value products. Beef ( U.S. $6200 tonne), Pork (U.S. $2,600 tonne), Chicken (U.S. $1,090 tonne), Dairy i.e. butter ($4,030 tonne), versus soybeans (U.S. $340 tonne), Corn (U.S. $153 tonne). 200,000 tonnes of combination meat-dairy products are equal to 10 million tonnes of soybeans.

With African Swine Fever (ASF) and its decimated swine herd, China doesn’t need corn-soybeans as much as they need meat (pork) to fill the ASF pork shortage. eFeedLink predicts Chinas pork imports from U.S.A. to reach $3.1 billion in 2020 up from about $1.25 in 2019.  Some of the increase will be at the expense of Brazil and E.U. to meet the Phase 1 import commitment.

Tim Hortons is the largest fast-food chain in Canada.  They have been selling Beyond Meat products (Fake Meat). Last week they announced they are stopping the sale of Beyond Meat Products because the demand is not there. 

Last week we reported my son works at a local McDonalds cooking Burgers and “Beyond Meat burgers”.  Only 1 out of 100 burgers sold is a “beyond meat burger”.  Maybe this “fake meat” will sell somewhere. But where? 

Summary:

It is rattling futures dropping over $10 in a week. Maybe unprecedented.

Upside-cash hogs have held so far.

Pork Cut-outs declined but not a scale close to the lean hog future drop.

Appears so far China and Europe Hog Prices have held. We suspect the futures collapse is an overreaction by a market my late friend Doug Maus called “Chicago! Las Vegas with no rules”.

We ourselves wonder if the futures market is related to the hog market as show pigs are to the swine industry.

Lots (almost all) countries do fine without a lean hog future market. Does it really help producers?

Genesus News

Jem Farms

“A. very rigid and durable animal. Excellent litters and strong sows. Farrowing’s are quick and trouble free.”

Jem Farms, ON, Canada

Brenelm Farms

“Providing Consistency – large uniform litters, good consistent growth from wean to harvest. 25 pigs/sow/year with PRRS break.”

Brenelm Farms, ON Canada

Diamond Z Farms

“We have an older unit. The Genesus sow holds up very well in challenging conditions. The Duroc Sire proves to be the leader in Growth.”

Diamond Z Farms, USA

Missions to Asia enhance value for Canadian pork

0

By Andrew Heck

Relationships are crucial in business, and the pork business is no different. In many Asian societies, the importance of relationships is elevated even higher than other parts of the world. If you are doing business in Asia, like the Canadian pork industry, face-to-face interactions are priceless.

In November 2019, two separate Canadian pork delegations visited Japan and China with two separate yet similar goals of convincing buyers that they need our product. While the consumer needs and desires differ between the countries, the importance of these markets to our value chain cannot be overstated.

Canadian embassy in Tokyo full to the brim

More than 40 representatives of the Canadian pork industry visited Japan in early November 2019 to attend an event organized by Canada Pork International (CPI) at the Canadian embassy in Tokyo.

The representatives were on-hand to extol the virtues of Verified Canadian Pork, the consumer-facing brand for the Canadian Pork Excellence (CPE) quality assurance program, which is being implemented by many producers across the country as a value-added identify for premium Canadian products.

In 2018, Canada’s pork exports to Japan totalled $1.3 billion, making it our second-most value market, just behind the U.S. Japanese buyers have a great deal of respect for the Verified Canadian Pork brand and what it represents. In fact, CPI uses more than one million branded stickers every month to distinguish our pork in that country.

“Canadian producers can be proud to know just how appreciated their efforts are overseas,” said Neil Ketilson, Chair, CPI. “Japan’s culture for quality and detail is known around the world, and it’s a testament to the work our producers and processor’s do to ensure our product is the best in the world. The Japanese appreciate quality and consistency and the Canadian industry delivers to their specifications.”

The embassy event featured a news conference, information seminar and pork tasting reception to excite guests. Speeches and presentations were delivered by CPI and CPC officials. Reportedly, the embassy had never hosted an event of this magnitude and scale, with the crowd of eager Japanese buyers overflowing into the hallway outside the theatre where the event was hosted.

Touring Japan to gain a first-hand consumer perspective

Following the highly successful embassy event, some members of the delegation returned to Canada, while others stayed behind to embark on a series of tours highlighting the Japanese pork consumer market.

The first tour was scheduled to take place at Costco Japan—a major buyer of Canadian pork. Costco Japan is a wholly owned subsidiary of Costco U.S., with 26 locations in the country since expanding there in 1999. In contrast, Canada has 100 locations. The deal-breaker: Japan has more than three times as people as Canada and a higher proportion of its population as Costco members.

Brochures are used to explain the value proposition of Verified Canadian Pork to Costco Japan customers.

In Costco Japan’s meat coolers, Canadian products are featured distinctly from lesser-quality, lower-priced products, side-by-side, which speaks to the power of Canadian pork. The competitive sales levels, relative to Japan’s own domestic product, reinforces that understanding.

The second tour brought the delegation to HyLife Pork Table—a direct-to-consumer marketing concept that separates the company from many contemporaries in Canada. HyLife’s pork, raised mostly in Manitoba and Saskatchewan, is processed at the company’s plant in Neepawa, Manitoba, then shipped worldwide, with a strong emphasis on Japan. The Pork Table draws a direct line from the Canadian producer to the Japanese consumer, creating a narrative around the product that sets it apart in the market.

HyLife Pork Table is a concept restaurant in Tokyo that introduces HyLife’s products directly to Japanese consumers.

“Pork restaurants are unique in Japan. Generally, Japanese consumers think of pork as more of a daily food to be eaten at home. But actually, they recognize that things like pork steak and dry ribs are very attractive for them. We can also provide these meats at a reasonable price compared with something like beef,” said Nick Funakoshi, Chief Marketing Officer, HyLife Pork Asia. “We also serve Canadian maple syrup, ice wine, whisky and beer. As a business, HyLife Pork is constantly growing, and we now have customers from Hokkaido to Kyushu.”

African Swine Fever has China hungry for Canadian pork

Right on the heels of the Japan visit, a separate delegation of representatives from the CPC and Canadian Meat Council (CMC) made its way to several locations in China with strategic trans-Pacific shipping positioning: Tianjin (near Beijing), Shanghai, Shenzhen (near Hong Kong and Guangzhou).

The delegation went to China to make connections and talk about where improvements can be made, given some of the recent barriers to trade. The delegation had a goal to rectify any issues that could cause hurdles for Canadian pork’s entry into China in the future.

In June 2019, China banned all imports of Canadian pork products after the discovery of a fraudulent veterinarian’s certificate that indicated a product of supposedly Canadian origin contained ractopamine—a feed additive that is legal in many countries, including Canada, but banned in China.

More than four months following the declaration of the ban, just as the Canadian delegation had arrived in Japan, an announcement was made signalling that the ban in China had been lifted.

In 2018, Canada’s pork exports to China totalled $514 million, making it our third-most valuable market, just behind Japan. Sales in 2019 were on pace to double 2018 levels until the ban was put in place, which would have effectively placed the two countries neck-and-neck by dollar value to the Canadian pork industry.

Nova Scotia Premier Stephen McNeil spoke at the Canada-China Business Council’s annual general meeting in Shanghai about the importance of relationships.

When the ban was lifted, the news quickly spread, exciting Canadians, but concerning the Japanese, who are left to wonder if Canadian pork will now flow more slowly into their country, on account of China’s demand. Only time will tell, and it will be important for the Canadian industry to navigate these areas carefully to preserve the long-standing, treasured relationships we have, which has resulted in nearly half a century of uninterrupted trade. Neither the Canadian nor the Japanese take that lightly.

“Thanks to our special relationship with the Japanese, we have been able to flourish in the export business,” said Brent Moen, Chair, Alberta Pork. “The Japanese have always been exceptional customers, and our industry can’t ever lose sight of that. We look forward to increasing sales.”

While concerning for our partners in Japan, the lifting of the ban is very welcome by Chinese consumers, who have been hit with prices that have more than doubled since the ban was put in place, thanks to a similar restriction on U.S. meat imports and the loss of nearly half of China’s pig herd to African Swine Fever (ASF).

The Verified Canadian Pork logo stands out on a meat cooler placard for Sunterra Meats of Trochu, Alberta, found in a supermarket in Guangzhou.

With the two recent Asian visits under its belt, the Canadian meat industry is feeling confident that critical trade relationships have been effectively fostered. As our industry continues moving in an export-based direction, this can only be a positive outcome during a time when the news has not always been so positive.