Farmscape for January 4, 2011   (Episode 3492)

The president of the Canadian Pork Council says Canada's pork producers will have to adjust to the new reality of a strong Canadian dollar.

2010 began on an optimistic note with Canadian pork producers anticipating improved prices and a return to profitability which occurred briefly this summer but that optimism was replaced by severe disappointment with the market crash this fall.

Canadian Pork Council president Jurgen Preugschas says the reduction in hog supply has resulted in improved hog prices and the expectation is for hog prices to remain strong but it appears we're going to have extremely high feed prices and possibly feed shortages and, at the same time, the strength of Canadian dollar will reduce the competitiveness of Canadian pork.

Clip-Jurgen Preugschas-Canadian Pork Council:
The impact of the strong Canadian dollar vis a vie the U.S. dollar affects our exports and being that pork in Canada, over 50 percent is exported to other nations, it has a tremendous impact.

Having said that we also realize that we're not going back to a 70 cent dollar so we're going to live with a strong dollar.

We have to work at keeping our costs in line with our competitors from other parts of the world and live with the new reality.

That will take some time to get used to and get all those costs in line with that higher dollar.

Preugschas notes Canada is a feed producing nation so it  makes sense to add value to that feed by producing pork as well as beef and poultry.

He says feed availability and feed prices are a major concern and, if feed costs rise, pork prices will have to go up as well because pork producers can't sustain the types of losses they've faced the past four years.

For Farmscape.Ca, I'm Bruce Cochrane.

       * Farmscape is a presentation of Sask Pork and Manitoba Pork Council