EDITORIAL
Time to get in the game
Ontario's independent swine breeders have been a driving force behind a genetic base that has established Ontario as a leading producer of healthy, lean hogs.Throughout the years, independents have come and gone but, despite the highly-competitive nature of the business, have managed to work together for the good of the industry. Producers who have shipped pigs for a few decades will likely recall the breeders' role in establishing the Ontario Swine Breeders Code of Fair Practice, a pact with producers to ensure breeding stock meets commercial requirements.
Breeders also helped establish the Ontario Pork Congress, the industry's showcase, and have been big backers of the Ontario Carcass Appraisal Project which has helped identify both the good and bad meat traits found in a range of Ontario hogs.
But all is not well in the breeder camp. Breeders continue to bicker about the future direction of Ontario Swine Improvement, and the resurgent Ontario Swine Breeders Association, whose internal squabbles have generated lots of press coverage, has had trouble deciding who will represent the organization on the OSI board of directors.
As the political games continue, breeders appear to have lost focus on the job at hand - breeding better pigs. Independents have done a fine job identifying traits and breeding for them, but with the advent of gene mapping, the door to new genetic breakthroughs has been thrown wide open.
Corporate breeding operations have recognized gene mapping potential and put up their money, but independent breeders have shown little commitment.
Over the long term, breeders, whether they be corporate giants or small independents, who put their resources into gene mapping and identifying genes that can produce a more efficient pig, could be holding all the cards.
If gene manipulation holds the solution to boar taint, for example, the patent holder could play the trump card: Eliminating the need to castrate males, which would lower producers' costs, improve feed conversion and produce leaner animals.
University of Guelph's boar taint guru Jim Squires says studies show that eliminating the need for male castration adds $9 to the value of every male animal.
As the industry prepares for the next millennium, meanwhile, number crunchers contend that the average profit margin per pig will shrink to $5 in 2002.
If Ontario's independent breeders aren't able match the genetic advantages corporate breeders could offer, they may have to fold their hand.
For the game to continue, independents have to solve their political problems and work collectively. Gene research costs money - as much as $250,000 for a study alone - but if breeders work together, costs can be shared and so can genetic discoveries.
Pool ponders pork
Manitoba Pool Elevators is the latest Prairie pooling agency pondering pork production.
At Manitoba Pool's recent annual meeting, delegates told management to determine whether the organization could make a profit pedalling pork. Earlier in 1996, the Saskatchewan Wheat Pool announced it would investigate pork selling prospects. SaskPool already owns 80 per cent of Heartland Livestock Services, which plans to build several $11.8-million hog operations. The three-site operations would include a 2,400-sow gestation barn, two nursery units and finishing barns that could accommodate up to 8,000 market hogs.
The Manitoba Pool currently owns 20 per cent of Heartland, but delegates debated whether they wanted to increase their hog investment. Manitoba Pool president Charlie Swanson said some of the investment ideas discussed have included product processing and feed mills. Many delegates, however, feared they could be promoting vertical integration by linking feed, production and processing facilities. Some wanted to know what effect integration would have on family farms and also feared the pool would be linked to possible environmental problems.Soaring exports
At their current pace, Canadian live hog and pork exports should top the $1 billion sales record set in 1995. For the first six months of 1996, live hog and pork exports surpassed the $700-million plateau, about $175 million ahead of 1995's pace.
Canada Pork International executive director Jacques Pomerleau says world pork exports are expected to triple to three million tonnes by 2000, and Canadian producers are poised to grab a substantial portion of the market.
Pomerleau says both Canada and the U.S. are best positioned to take advantage of the burgeoning export market. Declining feed and export subsidies, tougher environmental rules and disease are making it tough for major exporters, such as Denmark, the Netherlands and Taiwan, to maintain market share, Pomerleau says.
Growing demand throughout the Pacific Rim is fueling current markets, and Pomerleau expects similar demand growth to come from Latin American countries.
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Open markets move west
Following the lead of its eastern neighbours, Alberta has adopted an open pork market. The new system, which came into effect last month, will allow producers to sell hogs to the Alberta Pork Producers Development Corporation: sign a private contract, or sell directly to packers.
Alberta had used a single-desk selling system since 1969, but provincial Agriculture Minister Walter Paszkowski pushed for a freer market. He says producers will get a chance to vote on the merits of the new system after a two-year trial.
The new Alberta system will bear a striking resemblance to Manitoba's open market system which went into effect last July. Manitoba Pork still markets most of the province's hogs, and also offers future pricing options, allowing producers to manage price risk. The Manitoba pork board's Ted Muir says more education is needed to help producers take advantage of the options system.
Ontario Pork launched a similar options system last fall. Like Manitoba producers, Ontario farmers have been slow to take to the new system. At press time, 13 producers had signed up for the program.
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More Thorn Apple losses
Michigan processor Thorn Apple Valley has reported improved financial results for its first fiscal quarter of 1997, but the company is still in the red. For the quarter ending Sept. 20, Thorn Apple posted a US$1.7-million loss on total revenues of US$286.9 million. For the same period in fiscal 1996, the company lost US$5.2 million on total revenue of US$263.7 million.
Thorn Apple's president and chief executive officer Joel Dorfman recently told Feedstuffs that the company's kill facilities are now operating near top efficiency, but short hog supplies still hamper profitability.
Dorfman said Thorn Apple's hog procurement has increased by two per cent, but he expects fiscal losses to continue into 1997. He predicted an increase in the hog run would produce better processor margins, as good hog prices encourage producer expansion.
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The female factor
Farm profits increase when females produce superior progeny for many litters, but too often maternal female genetic lines are not considered an important part of the hog genetic equation.
That's about to change in the U.S. Producers south of the border have approved funding for an extensive study that will evaluate maternal female genetic lines for sow longevity, breeding, litter size, and milking ability.
More than 600 females per genetic line will be tested, and progeny will be also be evaluated for growth, carcass, meat quality and eating quality traits.
Reproduction records will be maintained on each line through four parities, says National Pork Producers Council research director Rodney Goodwin. Progeny from litters will also be placed in segregated early weaning facilities until they weigh between 40 and 60 pounds, to help measure feed efficiency performance in segregation facilities.
After slaughter at 250 pounds, carcass traits will be evaluated, and loin and ham samples will be tested for nutrition content, meat quality and eating quality traits. Program results are expected in 2000.
Genetic research has paid off for U.S. producers. In 1995, terminal line research found an US$8-per-pig difference in growth and backfat traits between the best and the poorest sire line, Goodwin says. "When meat quality traits were added, there was US$18-per-pig difference between the best and the worst-quality sire lines."
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Exports hit European wall
European Union countries are doing their best to keep Canadian and U.S. boneless pork out.
Under World Trade Organization rules, Europe agreed to take 75,000 tonnes of pork, but exports to the EU are almost nil, says Martin Rice, executive secretary of the Canadian Pork Council.
Rice says technical barriers used by European countries have cost Canadian producers almost $70 million in sales. EU countries, however, have enjoyed free access to North American markets and annually sell about 100,000 tonnes into the U.S. market and 5,000 tonnes into Canada. Rice says both the U.S. and the Canadian pork industries had expected to sell a combined 60,000 tonnes into the EU market, but EU officials have been slow to approve North American slaughter plants which must meet tough standards. Only three U.S. plants have been approved for European export, while no Canadian plants have been given clearance. Both Canada and the U.S. accept the word of EU officials who claim their plants meet North American standards. EU officials, however, insist on inspecting plants in both the U.S. and Canada before allowing imports. The EU, made up of 15 European counties, is the largest pork market in the world.
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Dutch target meat quality
Dutch researchers say they have found the magic bullet, a gene that may help select pigs with desirable meat quality.
Scientists at the DLO Institute for Animal Husbandry and Animal Health say the gene is responsible for 10 per cent of the variation of intra-muscular fat, or marbling. The researchers say at least two-per-cent intra-muscular fat is needed to make good-quality pork. They hope to find ways to use the gene to increase pork marbling without increasing backfat. - BT
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