A U.S. based agricultural economist is confident, despite the current economic squeeze, the long term outlook for North American pork production remains positive.
Fueled by high feed costs due to increased competition for corn from the ethanol industry, low hog prices due to an over-supply, the global recession and the impact of the H1N1 flu, the North American hog industry is facing its worst economic squeeze ever
University of Missouri agricultural economics professor Dr. Ron Plain notes U.S. producers have lost money in 20 of the past 22 months and losses in the Canadian industry have continued even longer.
Pork is quality meat and people like it.
If we look at long term, for the last 70 year or so, there’s about a one and half percent per year growth rate in demand for pork and so with time a growing world population and, in general, a wealthier population means that we need to grow our industry both in the U.S. and Canada and supply that growing demand.
Long term one of the key things is this whole issue of competitive position in the world and I think North American hog industry long term is a place that’s going to gain market share.
The portion of the world’s pork produced here in the U.S. and Canada is likely to increase.
I think we’re in a cost competitive position and still a regulatory competitive position to places like the European Union.
Certainly hog producers in both of our countries are losing an enormous amount of money and unfortunately a number of them won’t survive the current situation but long term our plentiful supply of feed grain and our environmental situation puts us in a pretty good shape once we get through the current economic problems.
Dr. Plain acknowledges the weak economy worldwide is hurting the pork industry right now but if we can turn that around and generate some improvement, that will certainly help.
Soource: Farmscape.Ca
