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High hog prices ‘sure nice’ for expanding producers

Relaxed regulations sparked a building boom in the Manitoba pork industry; higher prices are just the icing on the cake

High hog prices are a boon, but hardly a deciding factor, for hog producers building and expanding in Manitoba.

“It’s sure nice,” said Henrik Thomsen, owner of Canmark Family Farming Ltd. “It’s good timing while we’re building.”

Thomsen will nearly triple his Roblin-area operation when he adds 3,700 sow farrow-to-isowean spaces, 700 nursery spaces, and 1,500 grow-finisher spaces to his current facility, according to conditional use permitting documents.

He said the higher hog prices have provided an income boost as they build, taking some pressure off of their finances.

why it mattersRegulations brought in under the Gary Doer provincial government made the cost of expanding hog operations near prohibitive. With those regulations relaxed, producers are once again able to build, but face an uncertain future.

Hog prices have risen since African swine fever broke out in China. The Chinese Ministry of Agriculture reported that as of April 23, 129 outbreaks had been detected in the country and just over a million pigs had been culled to prevent further spread.

ASF is fatal to pigs but does not harm humans.

Since March, Manitoba hog prices have spiked from around $140/100 kg (Index 100) to over $200/100 kg this month.

Thomsen started planning the expansion about two years ago, when prices were lower. His operation had been at its pre-expansion size since 2002. He saw a growing worldwide demand for protein, and, combined with his relatively low cost of production per pig, saw an opportunity to expand.

“We believe we’re good at what we’re doing,” said Thomsen. “I sure think there’s going to be room for Canmark in the future.”

While prices are good, prices for weanlings will also be higher, reducing profits for those buying them, said Andrew Dickson, general manager of Manitoba Pork. He said he’s seen more interest in expansion among farrow-to-finish operations like Thomsen’s.

Bill 24 sparks boom

In November of 2017, Bill 24 loosened building regulations for hog barns, the most important being the removal of a requirement for anaerobic digesters to treat manure in new barns. The regulations had amounted to a near moratorium on building.

At Manitoba Pork Council’s fall producer meeting in 2018, about a year after the rules were relaxed, Dickson said 8,350 sow places and 35,800 finisher places had been added that year. He said they expected another 160,000 placements to be built in 2019.

This outlook remains the same, Dickson told the Manitoba Co-operator on May 7. Some of the construction is already complete, he said.

Stats from the province say the provincial technical review committee has received 12 applications for new or expanding hog operations, mostly in southwestern Manitoba.

In 2018, Manitoba Pork established the Swine Industry Development Corporation to streamline the process for producers. The initiative helps farmers put together the reams of paperwork necessary for the technical review and permitting process.

As of this month, the SIDC has handled five applications, Thomsen’s included.

HyLife grows

In March, Manitoba pork giant HyLife submitted technical review documents for a four-barn, 24,000-head, nursery facility in the RM of Boissevain-Morton. The public review period for the proposal ended May 6.

HyLife president Claude Vielfaure said with the expansion of the Neepawa cutting facility, “we needed more pigs.” The expansion doubled the facility’s cut floor capacity.

Plans for the nursery began about a year ago, said Vielfaure. HyLife also recently built new barns and a feed mill in the Killarney area.

He added that these plans began before talks started with Thailand-based exporter Charoen Pokphand Foods Public Company Limited. HyLife announced in April that it had struck a deal to sell 50.1 per cent of its shares to the Thai company.

Vielfaure said relaxed rules following Bill 24 allowed them to begin searching for property and applying for permits.

The company, which began in La Broquerie, near Steinbach, had purchased the processing plant in Neepawa in 2008, according to HyLife’s site. Vielfaure said they continue to expand in southwestern Manitoba to expedite hauling from farm to processing, because land is more readily available and farmers in the area want the manure for fertilizer.

Regarding current high prices, Vielfaure said in his decades in the industry he’s seen many highs and lows. At some point, he said, one just has to decide.

“Hopefully we’re strong enough to continue in our plans no matter what the prices do.”

Swine fever spectre

Thomsen acknowledged the grim prospect of African swine fever making its way to Canada.

“Sometimes you have to take a chance in life,” he said.

He added he doesn’t know how the pork industry will manage to operate if ASF arrives in Canada, but he knows people will still need to eat.

Canada is still largely in prevention mode regarding ASF. Mid-March, the federal government announced up to $31 million in funding for dog detection teams to combat the risk of ASF entering the country through illegal meat imports.

Initiatives like the Livestock Market Interruption Strategy — a joint industry and government project to prepare for a loss of markets — is preparing plans for traceability, containment and zoning.

In April, Dr. Egan Brockhoff, veterinary counsellor with the Canadian Pork Council, told the Manitoba Co-operator that an outbreak would put the pork industry in “a dire position” within weeks. He estimated a case of ASF would close the Canada-U.S. border for six months.


The basics of SIDC

The Swine Industry Development Corporation is an initiative set up by Manitoba Pork in spring of 2018 as a vehicle to help producers build and expand their hog operations.

The provincial government approached Manitoba Pork and asked it to set up the corporation, said Andrew Dickson, general manager of Manitoba Pork. This came after Bill 24 passed in November 2017, lifting what amounted to a moratorium on expanding hog operations in Manitoba.

SIDC contracts with producers to help them navigate the municipal and provincial approval process. This includes hiring the necessary consultants, for which producers are billed at cost, said Dickson.

According to SIDC documents, services include project management, including strategic planning, co-ordinating a project team, reviewing invoices, preparing interim reports and submitting the final project management report.

It evaluates the site in light of government livestock development requirements. It works with administrative authorities across the levels of government and with adjacent landowners. It will put together the various aspects of the technical review process, such as water testing, soil testing, and documenting land access and surface drainage.

It will prepare the conditional use and technical review site assessment applications, monitor public comments on the technical review, and prepare material for the client’s conditional use hearing, including responses to objections and comments. It will also assist with pre-construction permitting.

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