When bidding on the Ontario pork board's open auction started earlier this month, the worst Ontario packer nightmare was not fulfilled. American bidders did not heat up prices, and at $1.73 a kg they seemed to reflect a North American pattern rather than a local one. After four days, auction prices were firming at 104 per cent of the old formula, nudging the top of the range.

Sources say Detroit's Thorn Apple Valley, with sights set on buying four million hogs a year, came in as an early buyer. Hatfield of Pennsylvania and Quebec packers followed. Early signs suggest the U.S. companies, now buying by telephone over the pork board's "independent" desk, plan on a long stay. Pork board sales and market development manager Rick Scragg says Thorn Apple is installing its own big-bucks electronic buying machine that will lock into the pork board's sales network.

Transition from the old negotiating system "was smooth," he notes. An early buyer was Maple Leaf Meats (formerly Fearman) whose top executive, Michael McCain, opposed the change. Scragg adds: "We really appreciate this support... and I know producers will, too."

While moving to an open auction made newspaper copy, the underlying significance was overlooked. Essentially it is a progression to a quite different marketing structure. Opting for a free market is the first step, and as the new set-up establishes a pattern, contracts will have to be adjusted. Today, 25 per cent of sales are by contracts made over recent months, with half of these held by U.S. packers. Perhaps even more important there is the question of countervailing duty that must be paid on exported live hogs and even weaners. With President Bill Clinton facing re-election, there is little chance he will risk offending the hog states. He is bound to keep the status quo. So the duty stays, thus reducing producer returns.

Some industry analysts predict producers will press their board to resolve the duty question. The opportunity may come in a few months from now when the London-based Progressive Pork Producers Co-operative Inc. (3-P) opens its doors for business. It already has a carcass delivery contract with Frederick and Herrud Inc. of Detroit, owner of Thorn Apple Valley.

It's more than possible 3-P will bid for some of the pork board's hogs, slaughter them and then ship carcasses south. Since a carcass classifies as a manufactured product, the U.S. does not apply tariffs. Taking this route would put more money in producer pockets. - JP

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Open border rumoured

Heightened behind-the-scenes bargaining in Ottawa and Washington suggests U.S. live hogs shortly will roll into Canada. Trucks must meet stringent health rules and strict border inspection before being allowed entry into Canada. Until now, Canada's veterinary regulations kept American hogs out of Canada unless they undergo a one-month quarantine-measures designed to stop the introduction of pseudorabies and other serious diseases. U.S. producers allege the measures are a form of non-tariff barrier, contrary to the North American Free Trade Agreement.

Ontario pork board CEO Julien Den Tandt suggests that bending on pseudorabies could trigger a softening of Washington's hard line on countervailing duties slapped against incoming live hogs. This trade-off was ruled an impossibility until recently. One is a health rule and the other governs trade. Den Tandt told the mid-February satellite pork conference in Shakespeare that Ottawa has "protocol" in readiness for a deal.

The Ontario pork board recently opened its teletype auction to U.S. bidders, and farmers pay countervailing duty on these animals. Also, Ontario is in a rapid expansion mode, with expected output nudging 130,000 a week inside three years. U.S. packers likely will become major bidders.

With presidential elections in the offing, Washington could unilaterally decree that Canada's health rules amount to a trade barrier. At that point, quarantine rules go by the board. - JP

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Small breeders find security in niche

By JOHN PHILLIPS

In an era when corporate pig companies and large independents carry market clout, some "experts" have written off the small breeders as an anachronism. Some suggest small purebred enterprises lack resources for achieving fast genetic improvement.

Theoretically, this makes sense but there's a flaw. Canada, likely with the Western world's largest number of family breeders, proves the system more than competes with all comers. The late Professor Brian Kennedy, who developed the EBV (Estimated Breeding Values) system, was convinced small enterprises had more than an edge over large companies which, of necessity, were too structured and lacked flexibility.

Being a Canadian, Kennedy may be perceived as subjective. However, outsiders such as Scottish geneticist John King and English geneticist Tom Alexander believe the apparently fragmented Canadian approach produces world beaters. They think enthusiasm and elasticity that often go with a small unit allow a rapid response to sudden market demands. Both King and Alexander point to the Duroc and Hampshire, long-standing U.S. breeds. Their role as a top-crossing boar when used with York x Landrace F1 females was ignored by most American breeders. Their potential, however, was grasped by Ontario breeders. Both breeds were brought into Ontario, stripped of their inclination to fat and dumpiness, and soon their descendants were exported to British and Scandinavian breeding enterprises.

Early pioneers were a young Norfolk county couple, Jim and Mary Field. During the 1960s, when still in their twenties, they boldly slipped into pig production and were fortunate to make mistakes almost at once. With no cash to spare after getting their first small farm they bought what Mary calls three old barnyard sows.

"They were vicious, terrible critters... there was no way we could do anything with them."

A $900 tax rebate was soon used to buy three purebred slimmed-down Durocs. But despite this bold move, their troubles were not over. The beautiful rust-brown Durocs soon displayed an unpleasant characteristic: poor conception rates. So, typical of the Fields, they cleared out this line and scraped together enough money to buy two bred Landrace gilts from Simcoe county's Alan Cook; others came from noted Landrace breeders Milton Foerster of Bruce county and Lloyd Hagey of Waterloo region.

Without knowing it, they got a speedy introduction to genetics from some of the world's best Landrace authorities who had helped put the breed on North America's map. Those were the days when most American pig men hooted at the mention of the Landrace, while breeding "purebred" boars to crossbred F1 females was viewed as outright mongrelization.

Jim Field says their continuing mentor was an uncle, Ford Jamieson, who chose stock for their breeding herd. His integrity was more than confirmed when he eyed animals that did not come from his own noted herd. With an innate feeling for bloodlines and likely genetic nicks, he set the Fields on a renowned breeding course.

Another ingredient was an eagerness to learn from others plus an ability to benefit quickly from their own mistakes. At the same time, Mary was a voracious reader and devoured all the breeding news from Britain and continental Europe where incipient breeding companies still struggled for industry recognition.

For their own Ja-Mar Farm the Landrace proved a fast-growing success. Soon, litters from purebred females averaged between 12 and 13 raised, with backfat dipping to 14mm and days to market (200 pounds) nudging 160, Jim says. He adds that sheer performance statistics were not their yardstick; rather, they sought sow docility and large, even and heavy litters.

They were 20 years ahead of their time. Late last year world pig authority John Gadd warned a Shur-Gain meeting in St. Mary's that sheer numbers are no guarantee of success. His own studies show that once animals weaned per sow (over 12 months) approach the "magic" 30 range, a commercial herd's bottom line drops sharply after the 25 mark.

The husband-wife team rolls with setbacks. While at first disappointed with the Duroc, they later returned to it "because it's a darn good breed and is essential to many cross-breeding programs," Mary explains. They later went on to build a highly respected 25-sow breeding herd, along with 50 Landrace and 75 Yorkshires.

While the Fields had no shortage of buyers, there were still major setbacks. Both recall the astonishment of importing a $2,000 female from Sweden whose first litter was only four youngsters. Even more worrying, her temperament was far from easy, the opposite of what they had as a breeding objective. She was shipped to a meat packing plant, along with her impressive Swedish genetic background.

"We learned another good breeding lesson," Mary sighs. Another set back occurred in 1987 when they detected a cough in one of their barns. At once they cleaned out their operation after taking the best litters by cesarean section. "We had to be honest with our buyers... all of them deserved disease-free stock."

Today they have a minimal disease breeding herd, with no brush with rhinitis, the various pneumonias and PRRS (Mystery Disease or Blue Ear), Jim says. Bio-security must rank among Canada's toughest, an approach that comforts potential customers. These include some of North America's top herds and a recent 560-gilt sale, mostly purebred Yorks and Landrace, with animals tested for PRRS and other major diseases three months ago.

To the Fields and other members of the breeding community, small is better than an obsession with growth for the sake of market place volume. "We have some of the world's best and we hide nothing... and that's the way all of us will stay in business," Mary stresses. She adds that Ja-Mar Farm trades semen and bloodlines (after a strict quarantine period) with other breeders, whether Quality Swine Co-operative's research and development, herd, Thames Bend Farms, Kent county's Bill Weaver or Jack Nethercott.

The Fields have no qualms when it comes to the future. Their son-in-law, Ed Van Den Elsen, recently bought a farm which has close links with Ja-Mar Farm. He now breeds gilts for Jim and Mary. But before using the existing barn, it was cleansed, fumigated and left idle for two months before new animals were housed.

"It's this sort of thing that will keep all of us in business," Jim Field says.