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Pork Producers Have Cost of Production Advantage

by 5m Editor
30 December 2010, at 11:08am

CANADA - The Saskatchewan Pork Development Board says preliminary data released by InterPIG shows the costs associated producing pork in Canada compare favorably with those in competing nations, writes Bruce Cochrane.

InterPIG is an international group of pig production economists which collects and shares information about swine production in participating countries and compares production costs.

Sask Pork industry and policy analyst Mark Ferguson says, although pork producers in all countries have been losing money, when it comes to production costs Canada has an advantage.

Mark Ferguson-Saskatchewan Pork Development Board

There's so many different variables.

In different countries they produce different carcasses, they measure carcasses differently, there's all these different currency issues so what we're trying to do is standardize the cost of production.

Just got some preliminary data back from this group and it shows Canada's cost of production compares really favorably with what other countries are doing.

Our cost of production is about 160 dollars per CKG which is right on par with what data from Iowa State indicates the US cost of production is.

It's right on par with where Brazil is.

The European nations all have a little bit higher costs.

They all are closer to 220 dollars per CKG so definitely cost of production is an advantage we have in Canada.

We have a very competitive cost structure and I think just knowing that and knowing that we're not alone in not perhaps being as profitable as we were.

Countries across the world are having issues with their profitability just like we are and I think it's important for producers to understand that when they make decisions about whether they're going to remain in the business, what they're going to do to expand.

It's important to know what your neighbors are doing, it's important to know what people in other provinces are doing and it's important to know what people in other countries are doing.

Mr Ferguson stresses the problems in hog profitability are not unique to Canada or to North America.

He says, despite the fact that producers in Europe receive more money for their pigs, they're also still losing money.

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