The General Manager of H@ms Marketing Services predicts Canadian pork producers will reap slightly stronger profits in 2012 than they did in 2011.
H@ms Marketing Services is a producer owned cooperative that represents approximately 300 pork producers in Manitoba and Saskatchewan.
H@ms General Manager Perry Mohr credits improved hog prices in 2011 to increased U.S. pork exports.
We saw record prices in 2011 in the United States.
Unfortunately that didn’t correspond or convert to record prices in Canada.
They were very strong prices but because our Canadian dollar was so strong for the majority of the year we saw some very good hog prices.
Other factors that influenced the margins that producers were able to retain of course were feed prices.
I’m hearing profits of anywhere from 20 dollars a hog down to about profits of five dollars a hog so I guess if I had to generalize I would say most of our producers posted a profit last year.
It wasn’t large.
I don’t think we’re going to see a large profit this year.
We may see a slightly larger profit than what we saw in 2011 and again the stars are going to have to line up.
We reap the benefits of the United States exporting a tremendous amount of pork.
In 2011 they had a record year.
Almost 24 percent of the pork that they produced was exported and if anything happens to interrupt that export business in 2012, we know that the pig crop is going to be slightly bigger.
We could see prices adversely affected by anything negative happening to the U.S. exports but based on what we know today we think that producers will have a slightly better year than last year, again not outstanding by any means.
Mohr suggests we have to draw on the assumption that the United States will continue to export about 24 percent of their pork production and that will provide a level of pricing, even with a strong dollar, where we’ll see fairly good prices here in Canada.
