The Manitoba pork industry has had to deal with all sorts of challenges over the past decade — a moratorium on new barns, trade issues with the U.S., disease outbreaks that wiped out hundreds of thousands of piglets, and a brief blockade by China — but it’s back on solid ground.
After the Chinese blockade of Canadian pork exports was lifted in November, Manitoba is on track to export about $200 million of pork products to that country this year. While diseases, including the porcine epidemic diarrhea that forced the destruction of about 400,000 pigs in Manitoba over the last couple of years, are not currently present in Manitoba, efforts are being taken to develop risk-management tools to help producers if and when another disease outbreak occurs.
On Thursday, federal Agriculture Minister Marie-Claude Bibeau announced a grant of just under $500,000 for Manitoba Pork to investigate the creation of an insurance product that would help hog producers mitigate the risk of losses due to outbreaks of disease.
For instance, while it is not present in North America, the African swine fever is wreaking havoc on the Chinese and Asian markets.
George Matheson, the chairman of Manitoba Pork and a producer in Stonewall, said although its tough to get accurate information, the Chinese market may have lost as many as 200 million pigs to that disease.
World production of pigs is about 1.5 billion annually, with about half of them produced in China.
"It’s closing in on 15 per cent loss of pork production globally," Matheson said. "It is extremely significant."
Andrew Dickson, general manager of Manitoba Pork, said the two-year study to develop an insurance product will consult with the same industry experts that assisted the Canadian poultry industry to come up with an insurance solution to guard against the effects of avian influenza and other diseases.
"We’ll study it and try to develop a model," he said. "We have to determine what the premiums and coverage would be, adjusted to what the market is prepared to pay and what reasonable coverage would be with the intent on applying it to the country as a whole."
Manitoba is Canada’s largest hog producer, at about eight million head per year. Last year, the province exported about $1 billion worth of pork, with about half of that going to Japan.
Last year, the province was on pace to export about $200 million worth of pork to China until the blockade took effect and disrupted trade for close to four months.
Dickson said totals for the year are not yet available but he said the province is looking to get back to that $200-million mark this year.
With two large processing facilities — Maple Lead Foods in Brandon and HyLife Foods in Neepawa — it is a model agri-food industry. It produces the hogs, which are processed here, and the value-added product is exported.
About 90 per cent of the pork processed from Manitoba hogs is exported.
The industry is responsible for about 14,000 jobs including truck drivers, veterinarians, the hog feed mill industry as well as the on-farm and processing plant workers. (The Maple Leaf Foods plant on Marion Street produces about one half of hams sold in Canada.)
Rick Bergmann, chairman of the Canadian Pork Council and vice-chair of Manitoba Pork, said "We are a big economic engine and we are reliant on trade. We want to make sure people have comfort in the fact that we have a good program on the farm and a good safe product for the consumer."
He said the concept of an insurance product for the industry has been gaining traction.
"In today’s society, there is insurance for all kinds of different things," he said. "Why not us."
Dickson said if everything goes right in addition to about $700 million in exports to China and Japan, Manitoba is forecasting pork exports of about $220 million to the U.S., $90 million to Mexico and about $50 million to South Korea.
"The industry is always full steam ahead, but sometimes there are roadblocks," he said. "If nothing untoward happens, we should have a decent year."
Martin Cash has been writing a column and business news at the Free Press since 1989. Over those years he’s written through a number of business cycles and the rise and fall (and rise) in fortunes of many local businesses.