H1N1 Delays Pork Market Recovery by One Year

CANADA - A swine specialist with Alberta Agriculture and Rural Development says the consumer backlash that resulted from the H1N1 flu has eased but losses to the North American pork industry will be huge, writes Bruce Cochrane.
calendar icon 9 December 2009
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"Estimating the Market Cost of H1N1" will be among the topics discussed as part of the 2010 Banff Pork Seminar slated for next month.

Reaction to news of the infection last spring was immediate with several countries imposing trade restrictions on pork resulting in large price declines delaying a return to profitability.

Ron Gietz, a business development specialist pork with Alberta Agriculture and Rural Development, says we'll never know the exact amount of loss but it was large.

Ron Gietz-Alberta Agriculture and Rural Development

In late April, 24 April, when the news broke here in North America hog producers were getting close to a break even price and they were setting themselves up for some modest profits and a bit of a recovery from what has been a very brutal couple of years in terms of their margins.

Then, instead of that happening, the market basically turned south at that time and continued to drop to lows in mid-August.

As a result instead of modest profits, perhaps what we would have expected through the summer, they had fairly large losses that continued through the summer months and right into the fall.

If you multiply those per head losses compared to what they might have seen and times the number of marketings you could easily get an impact to the primary production sector of hundreds of millions of dollars.

Mr Gietz estimates the virus delayed a return to profitability in the hog sector by several months.

He says, when the news broke last April, markets were just beginning to improve and it now appears the industry isn't likely to return to profitability until about the same time next spring.

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