The President and CEO of Kerns and Associates predicts the North American pork sector is poised to reap substantial economic benefits as the result of reduced pork production in the Pacific rim. While Canadian pork production has remained stable the United States has continued to expand and productivity has been off the charts.
Joe Kerns, the President and CEO of Kerns and Associates, notes upward of 75 percent of Canadian pork production is pushed into the export market while the United States is at about 25 percent so exports are key to profitability within North America.
Clip-Joe Kerns-Kerns & Associates:
Exports is the holy grail. In very rough terms between Canada and the United States we're going to spend some place in the neighborhood of eight percent of our disposable income on food. The rest of the world is some place in that 25 to 30 percent range if you take a very broad brush. Because of that we are sated. We are not where the growth is anticipated.
Our per capita consumption remains relatively static. Five percent of the world's population lives in North America yet we have 45 percent of the world's wealth. That's why I think these exports are so important. Number one, it's where the population base is and number two it's where the desire is and we call that desire demand. That's where everything is going to happen. You couple that with the shortage we've had inside of China, in the whole Pacific Rim.
The Pacific Rim has 70 percent of the world's hogs and the decimation that ASF is wreaking across that whole area is going to create a huge incentive for us to move product overseas. This is not just a humanitarian effort. This is an economic, very viable pay that is facing the North American pork producer and I think we simply have to wait just a little longer than what we had hoped for but it is still coming to us.
Source : Farmscape