Structural Change and Competition on the Prairies was among the topics discussed last week in Winnipeg as Manitoba Pork hosted its 2016 Annual General Meeting.
Kevin Grier of KG Market Analysis & Consulting
Grier said during his online radio interview with Farmscape.ca that when sourcing hogs, western Canada's pork processors have to think about the competitive impact of pricing and whether setting higher prices will stimulate production and increase available supply, or simply result in moving hogs from one processor to another and, at the same time, they must be aware of their larger lower cost U.S. competitors.
“One thing we have to get across about ourselves is that we are a global powerhouse in the world of pork,” cites Grier. “We are the third largest exporter in the world as well as the sixth largest producer, and we've been gaining and enhancing our market share in global markets, while at the same time gaining and enhancing market share in our own market against the Americans.”
Grier also stated Canada's thriving environment where the domestic demand for pork has been improving and global demand for pork has been improving also contributes to the overall outlook.
“You've also got a positive picture in terms of our overall cost of production at the producer level compared to global competitors,” he adds. “So I want to convey a positive message in terms of Canada's role here, about Canada's ability to compete, and that our producers should consider the very real fact that it's going to continue to be positive from a global perspective.”
Grier acknowledges there are challenges, such as high construction costs and pending new regulations, that are constraining growth but improved demand globally and domestically is positive and Canada is a very competitive so if you think about the big picture the scenario for the prairie hog industry is very positive in the coming years.
Source: MeatBusiness