The Steinbach District Director with Farm Credit Canada reports the bulk of loan requests for financing within the hog industry have come from operators looking to renovate existing facilities rather than build new facilities.
Provincial pork organizations in western Canada have been working to stimulate interest in the construction of new hog finishing barns in response to the need among the processing plants for increased volumes of hogs to meet processing capacity.
Barry Watson, the District Director for the Steinbach District with Farm Credit Canada, says FCC is actively involved in discussions with industry to explore what could be done to get some expansion and investment in new finishing capacity.
We’re certainly aware that the processors and the industry generally would like to get more hogs finished closer to our local markets so, as much as the opportunity is there, I would ay that the activity level on financing requests at Farm Credit Canada has been fairly low.
We have seen activity in the hog sector however it’s been more weighted towards barn renovations and so on for existing facilities. There has been some instances where existing barns that were out of production have come back into production with some meaningful renovations done to those barns before they were populated with hogs.
The dollars involved can be relatively significant. We’re still lending half a million dollars to a million dollars plus on some barn renovations. Largely it’s the new hog handling infrastructure that goes in, the different penning and some of the different feed systems and stuff that are going in today that just add to the efficiency and the proper treatment of those hogs as they’re grown for market. ~ Barry Watson – Farm Credit Canada
Watson says there’s been a fair bit of volatility in terms of hog prices, we’ve had some significant changes in exchange rates and there’s been some very meaningful movement in feed prices and this has all created some challenges.
He says discussions have centered on what can be done differently going forward and the financing world has a role to play in that.
