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Pork industry presses for $800 million in aid

Published on 11 July, 2009, Last updated at 01:21 GMT

Canada's pork industry needs an immediate injection of$800 million in government aid to solve the liquidity crisis that's pushed the sector to the brink of disaster.

The Canadian hog industry is losing around$3.4 million a day, as the financial toll from three years of high feed costs, trade issues and a robust loonie, followed by the fallout from H1N1 influenza, prove too much for producers to bear.

The $800 million would bring producers current with their suppliers, said Jurgen Preugschas, president of the Canadian Pork Council.

"Most of us are struggling to make our monthly payments to our feed costs, our veterinary supplies, our salaries, our wages and all of that," Preugschas said Friday at the Alberta Pork crisis rally in Calgary.

Held on the grounds of McDougall Centre, the rally was aimed at raising awareness about the plight of hog producers in Alberta, where the $1.2-billion industry teeters on the verge of collapse.

More than 2,400 people attended the event, where they heard, among other things, how the financial detestation has reduced the number of Alberta pork producers to 450 from 1,500 just three years earlier.

Hog producer Alfred Neufeld was on hand for the rally. He noted there used to be eight producers in the Acme -Crossfield area. Today he's the only one left.

Neufeld, who runs an 800-sow, farrow-to-finish operation, said hog producers are sinking deeper into debt and losing equity, and the government programs that are available aren't enough anymore.

"Nobody in Alberta wants to farm so that the only way it will work, the only way you can make your feed bill, is through government programs," he said.

Alberta Pork has put forth five options to inject liquidity into the local industry to provincial Agriculture Minister George Groeneveld.

Pork facts - About 450 agriculture producers derive their primary income from hogs; - Alberta hog inventories are estimated at 1.6 million; - Alberta ranks fourth in hog production behind Quebec, Ontario and Manitoba; - Annual exports of live hogs from Alberta are about 600,000 head; - A typical hog operation has a positive annual impact of nearly $4 million on the provincial economy and $3.4 million on local economies; - The overall impact of hog production is estimated at $1.2 billion on the provincial economy.


The points could be expanded nationally, so it was thought they would be raised as part of the general discussions at Canada's federal, provincial and territorial ministers of agriculture annual meeting this week in Ontario.

Officials had hoped for some announcement in time for the rally.

Alberta Pork's proposal is separate from the Canadian Pork Council's strategic transition plan, which is done in conjunction with the provinces.

In a news conference earlier Friday, Federal Agriculture Minister Gerry Ritz said the ministers spent a lot of time discussing ways to continue supporting Canada's pork farmers.

"We all know there are no easy solutions. We also know that it's vitally important to make sure that efforts to help don't provoke devastating trade challenges," Ritz said in a post-meeting news conference.

The emphasis was on strengthening existing programs, though few specifics were offered.

When asked what kind of message he had for the Alberta Pork rally, Groeneveld, whose parliamentary assistant was tapped to attend the event, said he didn't think Alberta producers were expecting a funding announcement.

"We're there in a support role to show them that we care. As the other ministers have said, there are programs out there that we can help them with, and will work for them at the end of the day," Groeneveld said.

Added Ritz: "We will continue to work with them at whatever level to make sure they have that liquidity," he said.

Paul Hodgman, executive director of Alberta Pork, said the options are needed because government programs generally are for normal business cycles and don't work in catastrophic situations.

"It's not that they're bad programs, it's just that they're not designed for this purpose," he said.

Preugschas was disappointed by the lack of specifics from the ministerial meeting, but noted he's been assured by Ritz the government is looking at the council's "ask."

"We're hopeful they'll look at those asks in a positive way, but it's critical that an announcement comes very soon," he said.

Canada's pork industry generates 42,000 jobs across the country, he said.

Keeping these jobs is key at this time of economic crisis.

"We're asking only for$800 million, which is very little compared to what the auto industry got for not a lot more jobs," Preugschas said.


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