Lots of thoughts

I’m writing this blog at the Minneapolis airport as I travel to London, Ontario for this weeks London Swine Conference and do a client farm visit. Both my presentations at the London Conference and my client visit deal with the application of wean-finish facilities for Ontario producers.

In the US this decision has been relatively easy as midwest producers invested in new production facilities. The decision is tougher for Canadian producers as they have much higher construction costs and have limited investment in new facilities for the past 8-10 years.

Both Canadian and US producers are watching with interest the markets reactions to Friday’s USDA Hogs and Pigs report. Of most interest is the farrowing intentions for this summer and fall quarters. Did the US survey correctly detect the true producer intentions as new farrowing facilities come on-line this summer and fall? Based on my experiences I suspect they reported a slight under-estimation of the expansion. On the other hand, the large price decline this spring (due to pulling market sales forward, slower consumer demand due to winter weather, west coast port slowdown, etc) may have caused some to pause in their expansion plans.

Slat suppliers in this region report very large interest in slats for new facilities, but down payments haven’t been made yet for many of the talked about new facilities, meaning these could end up canceled relatively easily. In this region, these new facilities are wean-finish or grow-finish with the new breed-wean units being generally constructed at the fringes of our production region (north of Hwy 212 in Minnesota, in South Dakota, Missouri, etc).

So far this year, the new breed-wean facilities are about evenly split between group housing and individual maternity pens (crates). Many making the major investment in breed-wean are not sure that the move to crate-free will occur by the deadlines that buyers such as McDonald’s have espoused. At this point in time there is no certification program (nor market access or market premium program) that aligns production with the final purchaser of our product.

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