Province to back new loan program for hog producers

A financial stabilization program is on the horizon for Manitoba pork producers.

Speaking to hog farmers and industry representatives in Niverville, Manitoba Pork Council chairman Karl Kynoch outlined a new loan program designed by the council — one that would see cash loans distributed by financial institutions, administered by Manitoba Pork Council Corporation, and guaranteed by the provincial government.

Manitoba pork is hoping the program will be capped at $75 million.

“We’ve still got a little way to go, but the government has agreed to talk about long-term viability programs with us, and we’re moving forward,” said Kynoch.

The Manitoba Hog Stabilization Program would see a mandatory $5 levy applied to all hogs sold in the province. Farmers who opt out of the program or who are not eligible for the program would have funds immediately returned to them, but for those who participate, the levy would go directly to repaying loans provided by the program.

Kynoch said the objective is to provide producers with enough cash to cover their costs and finish their pigs during this period of financial hardship.

Loan payments would be calculated on a monthly basis, based on the difference between production costs — such as feed — and market returns, he added.

Repayment of loans will be spread over at least five years, although the program would run for 10. It is one component of bringing long-term stability to the hog industry, said Kynoch.

The announcement was met with few question and even fewer comments from the producers on hand.

“Right now I don’t think we will necessarily use it, but in the future that might change,” said Kevin Peters, whose family operates a 3,000-sow operation near Randolph.

“For us it’s simply a loan, so if we can do without a loan we will try and continue to do it that way,” he said, adding there are positive aspects to the program, including an interest rate of 4.5 per cent.

But for ISO-weanling producers, the program offers nothing.

“They don’t want to be subsidizing any hog that is leaving the province,” said Kynoch.

That point did spark discussion among producers.

“It’s not really solving the problem, I would have liked to see a program where the government helped subsidize feed costs, that would have helped all farms, including weanling exporters,” said one producer who wished to remain anonymous.

The council is still working with Manitoba Agriculture and Rural Initiatives (MAFRI) to hammer out program details, including when the first cheques would go out, and how retroactive the program would be.

Kynoch said the council is pushing for September 1, while MAFRI is looking at October. In either case, the first cheques would likely go out in February.

“The one thing the industry really doesn’t want is another loan, the producers are maxed out on credit,” acknowledged Kynoch. “But yet I think everyone realizes that getting a cash injection from the government is not going to happen… so this is probably the best alternative.”

For some producers the program is moot; they’re leaving the industry now.

“I’ve got 24 pigs left and in two weeks the barn will be empty,” said Jim Penner.

Others at the Niverville producer meeting were in the same situation, noting this will be the last producer meeting they attend.

“This is a nostalgia meeting for a lot of people,” said Paul Moser.

About the author

Reporter

Shannon VanRaes is a journalist and photojournalist at the Manitoba Co-operator. She also writes a weekly urban affairs column for Metro Winnipeg, and has previously reported for the Winnipeg Sun, Outwords Magazine and the Portage Daily Graphic.

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