Farm inventories of cattle, hogs and sheep all declined between Jan. 1, 2008 and Jan. 1, 2009, reflecting market uncertainty and rising input costs, Statistics Canada reported Tuesday.
Hog inventories were down 10.2 per cent to 12.4 million, the federal statistics agency said. Cattle producers reported 13.2 million head as of Jan. 1 this year, down 5.1 per cent compared with the same period a year earlier. Sheep and lamb numbers fell 2.1 per cent to 808,200 head.
Rising input costs, due in part to increased feed grain prices and market uncertainty, had an impact on producers in all three sectors, and exerted downward pressure on profits.
In addition, country-of-origin labeling (COOL) legislation in the United States created an uncertain marketplace for Canadian producers. In the case of hogs, the Canadian government put the cull breeding swine program in place to help hog producers reduce the size of their herds.
The decline in hog numbers in 2008 continued a three-year downward trend. The breeding herd alone, mainly sows and gilts, declined 7.1 per cent to 1.4 million head.
Despite the recent decline in the Canadian dollar, hog producers are still facing financial pressures. Lower prices drove down revenues for hogs sold for domestic slaughter and for export.
Over the last decade, hog production has evolved toward complete market integration in North America. American hog finishing operations took advantage of an ample local corn supply and fed it to weaners born from the breeding and farrowing operations in Canada. In addition, a shortage or a loss of slaughter capacity on one side of the border has been offset by sufficient capacity on the other side.
The national cattle inventory has been declining during the past four years. Between Jan. 1, 2008 and Jan. 1, 2009, the dairy herd fell 2.5 per cent, while the beef herd fell 5.6 per cent. The beef herd shows no sign of rebuilding, as the number of cows is down 6.6 per cent and the number of replacement heifers is down 9.7 per cent.
On Jan. 1 this year, there were 86,520 farm operations reporting beef herds, down 3.8 per cent from the same period a year earlier.
Beef numbers fell last year in the four major beef producing provinces: Alberta (-3.3 per cent), Saskatchewan (-8.0 per cent), Manitoba (-6.1 per cent) and Ontario (-14.5 per cent). These declines continued long-term downward trends. Combined, these provinces accounted for 89 per cent of the Canadian beef herd.
Between Jan. 1, 2008 and Jan. 1, 2009, the national sheep and lamb inventory declined 2.1 per cent to 808,200 head. Lamb and mutton production has slowed in recent years due to major challenges such as loss of export markets and domestic demand.
On the other hand, lamb imports to be fed and slaughtered in Canada have increased since 2006 to levels similar to those of the early 1990s.
Market receipts from the sale of sheep and lambs between January and September 2008 were down from the same period in 2007. Relatively strong prices helped offset the decline.