Back to the drawing board

Ontario pork producers table contentious marketing report. Now comes the tough part

In the aftermath of the recent task force recommendations to scrap Ontario Pork's role as a seller of hogs, pork board directors, like the producers they represent, are divided on the board's future. Still, new chairman Will Nap is convinced they can work together.

"We had to take the time to understand one another," Nap explains.

On directors' immediate agenda is an Oxford county resolution calling for "a working group" to provide further details of the recommendations. Make-up of the group, however, is contentious.

"A lot of board members aren't perhaps as enthusiastic about all the changes as the task force members are, and that's understandable because they spent nine or 10 months working on their project," Nap says.

He says many board members were unaware of task force proposals until shortly before the annual meeting, "because of the board's hands-off approach."

Carl Moore, who retired as chairman this year but remains on the executive, says a key task force recommendation to allow open marketing while maintaining producer licensing and price disclosure won't work. Nap insists, though, "there's certainly some value in the changes being suggested. We have to make changes, I think everybody recognizes that."

Many of Ontario's 6,000 producers will be watching the board closely. In recent months an increasing number have been illegally bypassing the board, perhaps spurred by the recent strike at Maple Leaf Meats' Burlington plant.

"We're not necessarily aware of all of them, but they will be brought to task," Nap assures. At the recent pork board annual meeting, Glengarry county's Marion Myers urged action against F. Menard, a Quebec-based organization, one of the country's largest producers, which has been expanding in Prescott county about 75 km east of Ottawa and allegedly shipping outside the board. Ontario Pork launched a civil action several years ago with no result to date.

The board won at trial last May in similar actions launched against three Ontario producers around the same time. The three - Gerald Gemus and Sons, Eric Van Boekel and Acre T Farms - have since filed an appeal but maintain they are currently paying all marketing fees.

"Producers deserve a level playing field," says Myers, a former pork board director.

Both Moore and Nap say the Menard case has been delayed by legal wrangling. They say constitutional issues have been raised by Menard, who is allegedly shipping his Ontario pigs to Quebec.

No spokesperson for Menard was available at press time.

Alberta Pork Producers Development Corporation director Jack Kalisvaart says his organization found coping with illegal shipments "a losing battle." Some Ontario task force recommendations arose from a review of Alberta's system and meetings with Kalisvaart.

Alberta producers have been operating a dual marketing system on a trial basis and are scheduled to vote on the issue this summer. They pay a $1 per hog fee for universal services.

Producers can sell directly to packers or through the Western Hog Exchange, a separate body run by three Alberta Pork directors. -Robert Irwin

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One on one with the task force

The Ontario Pork Industry Marketing Task Force Report is in the hands of the province's swine set. The report, of necessity, represents a consensus view of the task force members. We canvassed each member for their individual views on certain issues and what task force involvement meant to them. Here's a distillation of what we heard:

What's the biggest hurdle in implementing recommendations, and why?

"Getting producers to see the vision that's laid out in the report. We had the opportunity to see what's going on around the world, to view how other jurisdictions are structuring themselves to be competitive, and compare those systems to how we operate. There's a lot more entrepreneurial activity going on outside Ontario...and as an industry here we have to consider change now to set the tone for a competitive industry over the next 20 or 30 years, so the industry remains viable. And change is always feared."
- Dennis Zekveld, Victoria county, 100-sow farrowing operation

"I suspect it's in the detail of working through the recommendations and eliminating any confusion in some people's minds about what getting rid of single-desk selling will ultimately mean. Also getting so-called smaller producers to recognize that there's lots of opportunity for them."
- John Otten, Stratford, partner in a SEW multi-site production system network with some 100,000 hogs on 40-45 farms province-wide

"Getting everyone to realize that the recommendations don't necessarily represent huge change but represent necessary change. If being a pork producer is what you want to do in life, and make a decent living, then you have to accept the reality of what's going on globally. That reality means making some adjustment."
- Jody Durand, Huron county, 860-head finishing operation

"Getting people's mind set over the notion of accepting change. We're all so hesitant about that. It's not fair to expect people to change in a couple of days, but everyone now realizes there are people with different needs and they're sure talking."
- Liz Samis, Wellington county, 280-sow farrow-to-finish operation

"Making the decisions that need to be made quickly, but not at the expense of thoughtfully looking at issues like price discovery, and vertical integration."
- Richard Smelski, Shakespeare, Ralston Purina swine specialist

What recommendation will be toughest to gain acceptance for and why?

"Opening up the selling system, for sure. There's so much detail to be worked out, alterations to a system that's been in place for a long time that many people have grown up with."
- Samis

"The open sales area, letting in other agents. I can sense a big fear among some people that we won't be able to maintain minimum standards. There's the whole issue of licensing. My response to those fears is that with increased freedom comes increased responsibility."
- Zekveld

"Creating the producer sales co-operative for those who choose to participate. I think a lot of people wonder what's going to happen if, as the recommendation suggests, Ontario Pork stops directly providing hog sales services."
- Durand

"Acceptance of agents and sales. Smaller producers wonder how they'll match the economies of scale larger operators might have in negotiating sales. Sure, there are economies of scale, but there's no economy in risk. The numbers mean risks are greater."
- Otten

"Giving fellow producers the freedom to implement or explore marketing alternatives in confidence, and then acceptance of whatever alliances might come about."
- Smelski

What "other jurisdiction" was the most positive - or negative?

Smelski felt there were positives in each of the jursidictions visited and remarked on the present strength and diversity of the pork industry in Ontario.

The Hog Inc. Co-operative in Carville, Ill., was top of mind for the other respondents.

Durand liked how "they treated the farmer as their customer and regarded people and the sharing of information with those people as their strength, not buildings or a monopoly." He also came away impressed by how much work the co-op did to ensure producers got carcass data from the packers.

Otten, too, felt the depth of Hog Inc.'s data collection was impressive.

Samis said the benchmarking that Hog Inc. offered was of real value: "We haven't done near enough a job of benchmarking ourselves, and I think we can learn a lot from their system of differentiating what carcasses should go to what packers."

Zekveld saw Hog Inc. as a real blueprint for Ontario in terms of demonstrating a system "that gives producers the freedom to specify whether their hogs went through there or some place else."

Other comments?

All thought the opportunity to be thrown into a working group with industry players of diverse backgrounds was wonderful, as was viewing other systems.

Smelski said that the recommendations don't represent either a right - or wrong - way to approach moving the industry ahead. Rather, they emphasize the necessity of trying to find balance in a variety of areas. Among these, he cites politics, the global marketplace, preservation of the family farm, technology, resources and opportunity.

Durand joked the experience made him a whole new set of enemies: "I was a firm believer in the present set-up a year ago...didn't think we had to change. Well, I did the flip-flop, and that may be upsetting to some of the people who thought I'd be a voice for status quo in the report."

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