Better Pork - February 2006
BEHIND THE LINES
by ROBERT IRWINIs organic food production a fad? Practitioners don’t think so.
In the February issue of Consumer Reports, the Consumers’ Union (CU) advises its 4.5 million subscribers to buy organic meat, poultry, eggs and dairy whenever possible. Whether we agree with CU on this or any other issue is beside the point. The organization influences consumer buying decisions. Just ask the automakers.
The existing market for organic pork is tiny. Still, survival in agriculture means seeing beyond the present.That’s why Better Pork is looking at organic pork production in this issue. We found that it hasn’t made much of an inroad in the province’s pork production. With reports that organics make up three to five per cent of food production in general, however, optimists would likely say there is room to grow. But will it be profitable? CU says consumers should expect to pay double for organic meat.
It’s hard to predict where the organic market will go. As press time drew near, we received an announcement that Minneapolis-based grocer and wholesaler SuperValu had launched a new organic and natural food store concept, the first of a planned 15,000 square foot stores to be opened over five years. SuperValu went that way, reports indicate, because sales in the traditional grocery business were slipping.
The first of 50 planned Sunflower Market Stores features “value-priced organic and natural products in an upscale environment.” “Value-priced” means shoppers will pay 10 to 15 per cent less than in most organic and natural food stores.
The announcement says a “sizeable” 96 per cent of consumers purchase organic products occasionally and 27 per cent of shoppers buy organic weekly and that price is a turnoff.
If consumers pay twice as much for organic meat as they do for the conventionally produced product, as CU suggests, that should translate to increased returns for producers. Organic producers in our cover story are receiving a premium.Will this continue to be a premium market opportunity for growers? Better Pork will be watching this trend carefully.
It’s worth noting that the McDonald’s restaurant chain recently launched a blend of organic coffee available in 650 restaurants in New England and in Albany, N.Y. That’s less than five per cent of the chain’s restaurants in the United States. Proponents of Fair Trade coffee, supposedly produced by small farmers who practice organic and sustainable cultivation, would say that this is a good start.
I would like to welcome Kate Procter to the Better Pork team. Many of you already know Kate. She is the second generation involved with Bodmin Farms, her family’s breeding stock operation based near Brussels. Over the past decade, Kate has become recognized in both Canada and the United States for her expertise in reporting on the pork industry. I believe Kate’s unique talents will serve readers well as Better Pork continues its remarkable growth. Her first article, on the devastating and elusive PRRS virus, appears in this issue on page 30.BP
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Organic Pork - A Small But Growing Niche Market
Though organic pigs represent less than one per cent of the 5.3 million raised in Ontario, those producers who are giving it a try find it attractive both a financial and a lifestyle standpointby TREENA HEIN
Increasing consumer interest in what goes into pork is giving impetus to niche organic markets in Ontario and beyond. Keith Robbins, director of communications and marketing at Ontario Pork, characterizes organic pork as “another product attribute to attract consumers.”
However, the organic market is presently very small in comparison to conventional farming. Robbins estimates that organic pigs make up substantially less than one per cent of the 5.3 million raised in Ontario each year.
There are various reasons for someone to choose organic pork farming. Some Ontario producers are finding it a better financial venture than conventional farming. Also, says Robbins, “lifestyle may make it attractive for a farmer to go organic.” But, even though a major new initiative was launched this past fall, organic pork expansion will not be occurring rapidly any time soon, and space requirements are among the biggest challenges.
One organization that would like you to consider producing organic pork is Field Gate Organics. This alliance of 30 family farms formed in May 2003 is regularly in need of more organic pork, poultry, beef and lamb. Field Gate, based in Zurich, supplies several Ontario health food stores and meat markets with many types of meat, as well as some dairy, produce and baking. They also fill orders at a few restaurants, including Waldo’s in London and Chatham Street Grill in Windsor, and resorts such as the Taboo golf and conference centre in Gravenhurst. Field Gate retail stores can be found in London and Windsor. Additionally, the company runs a weekend stall at the St. Jacobs farmers’ market.
“We are seeing 15-20 per cent growth a year,” says Ted Soudant, president and general manager of Field Gate Organics. “Our largest pork producer may give 40 hogs a week.” Some weeks the smallest producers don’t have any hogs to market.
The pork farms which supply Field Gate range from 100 acres to 750 acres. Matthew Dick has farmed organic pork in Markdale with his wife Janice for three years, and they have been a regular Field Gate supplier for two. The Dicks chose to farm organically for two main reasons. Matthew believes spraying herbicides to be one of the contributing factors in his father’s death from cancer some years ago and, although he did some spraying in the past, he does not to do so now. The other reason is financial. “I can’t see how anyone is making money doing it conventionally,” says Matthew.
Ninety per cent of their certified organic feed, a mixture of barley, oats, wheat, peas and flax, is grown on the their land and the adjoining land of Janice’s parents, a total of 350 acres. The remaining 10 per cent is comprised of purchased corn and roasted soybean from another certified organic grower. “It’s a diverse ration in comparison to regular pigs,” says Mathew, noting that it contains about 14 per cent protein.
Wanting to keep things simple, the Dicks use the same mixture for sows, weaners and boar. “The cost of feed (about $350/metric ton) is not really all that far out from conventional guys. But if you don’t raise a lot of your own feed, it cuts into the margin.”
For parasite control, Dick adds diatomaceous earth to the feed. It is a non-toxic, substance made up from crushed fossils of freshwater organisms and marine life. A finely crushed sample of diatomaceous earth contains particles resembling bits of broken glass. It’s effect on insects is purely mechanical. Most insects have a waxy outer shell covering their bodies. A diatomaceous earth product (and there are many commercial products for sale under various names) scratches through this shell causing the insect to dehydrate leading to eventual death.
Last fall, they also tried feeding whole pumpkins after finding some research which points to pumpkin seeds as a natural de-wormer. They also provide minerals. “The healthier the pigs, the less I have to worry about them,” says Matthew.
The Dicks have used different sow breeds over time, presently stocking six York cross- sows that produce average litters of 10. Organic certification requirements demand that sows must be fed organically for three months before farrowing. The standards also place a 10 per cent annual limit on new breeding stock. However, the Dicks note that their third-party Canadian-based organic certifier (OC/PRO) is somewhat flexible with points like this, because if they purchase just one new sow, they have already exceeded that limit.
There is no organic regulatory feeding requirement for boars, as they are only what Matthew refers to as “sperm donors,” and the Dicks have used different breeds of boar over time. “Field Gate wants lean pork,” says Matthew, “and with some older breeds that is hard to accomplish, so new stock is something you have to look at. And some breeds like English Black are particularly good at grazing out in the pasture.”
Providing humane surroundings with year-round access to the outside, weather and management permitting, are part of the incoming Canadian regulations. (See below.)
Like other certifiers, OC/PRO does a planned inspection of the site and farm records once a year. “They have a walk around the barns and fields,” says Matthew. “They want records of when you walked the fields, when you made feed and how much feed, when the pigs were born and their lineage.”
Du Breton – being different to survive
Du Breton, a large vertically-integrated producer based in Rivière-du-Loup, Que., has been involved with organic marketing for over five years. Six Ontario producers have recently signed contracts to supply Du Breton with organic pork, certified through by U.S.-based Quality Assurance International (QAI).
Du Breton is currently supplying Whole Foods Market (WFM) and other outlets in Ontario with organic pork. WFM is the world’s largest supermarket chain of natural and organic foods. Vancouver and Toronto have had one store each since 2002 and a third Canadian outlet opened in Oakville in June.
Du Breton president Vincent Breton says the company has been involved in marketing organic pork for years and want to keep up with the growth in interest. “We’re a small company,” says Breton, “so we have to be different if we are going to survive. Right now, there are three programs running -- certified organic, certified humane and vegetarian-fed, antibiotic-free pork.”
Organic pork farmer Ron Kassies has supplied both Du Breton (on contract) and Field Gate (on a casual basis) since October. He farms 75 York cross-sows in Londsboro near Clinton. Kassies says he has “always raised drug-free pork anyway, so organic was the next step.” He continues to use homeopathic remedies to boost immunity and diatomaceous earth for parasites. “Demand can only go up,” he says of organic pork, pointing out that customers from years ago continue to call.
Before October, Kassies had an arrangement with Sunopta where the feed was supplied and all pigs went to them. The organic certification fees were paid by Sunopta as well. Since Sunopta ended the arrangement with him and other farmers, Kassies feels fairly confident about farm finances, but is carefully monitoring costs. “It eliminated the middleman,” he says, of the end of his relationship with Sunopta.
Feed costs range from $500-900 per metric ton for the various rations he uses on sows and piglets. He sold his feed mixer long ago when he went with Sunopta, but doesn’t rule out going back to mixing his own. “If I find I can save money by making my own feed, I will look into it at that time. But for now, I will buy,” he says.
Kassies also takes refuge in the fact that his current deal with Du Breton can be renegotiated or terminated within six months -- just in case, for example, feed prices take a jump. Costs to increase the housing square footage required under organic certification standards are still being incurred. Of the renovation, Kassies says “I’m still working on it.”
Setting the standards
There are many reasons why growth of organic farming remains slow. “The problem is that the organic industry is in its infancy, even though it’s been around 10 years,” says Field Gate’s Ted Soudant. “The organic producers sold to their neighbours and families and stayed small. A lot of them don’t want to become big.”
Finding enough organic feed can also be a challenge. “Our group of producers grows more organic feed than the group requires,” notes Soudant, “but on a national basis there is a shortage. The organic feed is going to Europe and Australia. Maybe at least 70 per cent of organic crops are leaving the country.” Adds OC/PRO CEO Larry Lenhardt: “Last year organic soybean and corn needed to be brought into Ontario.”
Soudant also lists an historical lack of infrastructure in terms of marketing and distribution as being one of the stumbling blocks to strong organic farming growth. To fill the need, Field Gate Organics (mostly meat, some dairy and produce), Great Lakes Organics (grains) and Unterbio (dairy) have recently formed the Organic Council of Ontario. This independent association representing approximately 500 organic farms will help move the organic industry forward, work together for efficiencies and take concerns to government.
However, the major challenge to serious organic growth is space. Under the incoming Canadian Organic Production System’s “General Principles and Management Standards” (already voluntarily recognized as part of Canadian-based OC/PRO’s certification, but not yet recognized by U.S.-based QAI), pigs must have “access to the outdoors, shade, shelter, rotational pasture, exercise areas, fresh air and natural daylight suitable to the species, its stage of production, the climate and the environment” (section 6.8.1a). However, farmers may temporarily confine stock because of inclement weather, stage of production, and “risks relating to soil, water or plant quality” (section 6.8.4).
The incoming standards also contain specifications for substantial minimum areas inside and outside, which organic farmers must provide for livestock (see table 6.8.13). This is in agreement with European organic standards, which place more of an emphasis on animal welfare than American standards. While the U.S. standards do specify that outdoor access must be provided, weather and management permitting, there are no minimum areas specified.
Mike Leclair, a policy analyst with Agriculture Canada’s Organic Production System Task Force, believes that “it’s desirable to establish minimum space requirements so that companies don’t compromise organic principles to make a profit.” He notes that the Canadian standards are being developed and voted on by a good cross-section of industry and consumer stakeholders, and are not government-imposed. All members of the public may provide their input.
Ron Kassies sees the requirements for outdoor access as a serious concern, one that will “set back the organic industry.” He observes that “it’s not feasible to have them outside in large quantities. Once you get past 20-30 sows, that’s a lot of landbase.”Kassies believes having pigs outdoors also means a greater risk of disease. Organic pigs don’t receive vaccinations and, if antibiotics are required, pigs are obviously no longer considered organic.
“It’s easy for an office person to tell you what to do. If there is a chance for a person like Larry Lenhardt to spend a week on a pig farm, that’d be a good thing.”BP
Getting your product properly certified
All clients who label their agricultural products as "100% Organic," "Organic" or "Made with Organic…" must be certified by a recognized third party. Certifiers simply check whether an operation is or is not in compliance with regulations; they do not give consultations on how to comply with regulations. Certification provides for proper product labelling, ensures a product's value and boosts consumer confidence while protecting the public from fraud.
In addition to certifying producers, certification companies can also inspect handlers, distributors, traders, processors, retailers and restaurants. Certification involves checking of records and a farm inspection. The cost depends on factors such as size of operation and location. With OC/PRO the initial evaluation in the year prior to organic certification costs about $375 (taxes included) with his firm, and yearly certification for a 100-arcre farm with more than 20 pigs runs about $670 (taxes included). It can take about two months for initial certification.
Typically, annual visits are planned in advance, but surprise visits are possible. If any non-compliance is suspected, a certifier will order tests on crop or animal tissue, which must be paid for by the farmer and are apparently extremely rare. Ecocert inspector France Gravel notes: “The farmers are paying for certification, so they’ll follow the regulations.” OC/PRO CEO Larry Lenhardt adds that the costs for these tests “can be four or five figures.”
Organic certification is being conducted by at least 30 companies in Canada. Three of the most common in Ontario are:
- Ecocert (www.ecocert.com), a German company established in 1991 and operating in 70 countries; office in Lévis, Que. (Tel. 418-838-6941.)
- Quality Assurance International (www.qai-inc.com), a U.S. company established in 1989 with offices in San Diego and South Burlington, Vt. (Tel. 802-860-6666.)
- OC/PRO -- Organic Crop Producers and Processors Inc. (www.ocpro.ca), a Canadian company established in 1991 with offices in Saskatoon and Lindsay, Ont. (Tel: 877-867-4264.) This is the largest organic certifier in Canada.
Among many other things, organic certification of producers involves checking that:
-- No antibiotics, hormones or insecticides are used on livestock. Animals must receive potable water safe for human consumption and must not have access to creeks and ditches.
-- Animals must be fed organic crops that are not sprayed with herbicides or pesticides.
-- Farmers must show that they have enough organic crop to feed their animals. Or they must show receipts from another organic crop farm, from which they bought enough feed for the animals. Crops are examined on a site-specific basis to see that they don’t butt up against non-organic crops and are protected by buffer zones.
-- Slaughtering is done at conventional plants. It must also be conducted in the morning after the decontamination of the night before. BP
© copyright 2006 AgMedia Inc..
back Being 'The Apprentice' in the Pork Value Chain
Know your mission and develop a plan to succeed, so that you don’t get fired in the agricultural 'Boardroom'
by RICHARD SMELSKI
The television series “The Apprentice" has created tremendous awareness of the extreme business skills required to survive in the business world. Thousands apply, hundreds compete, but only one survives the Boardroom. The others get ruthlessly fired.
What if a similar program existed called "The Pork Value Chain." Who in the industry would get fired?
In spite of doing one's best, for some boardrooms, it's not good enough. Like “The Apprentice,” many producers feel they have given their best and do not deserve to be fired. Others may feel they made it this time, but will they survive the next cut? "The Apprentice" is an entertaining boardroom adventure. “The Pork Value Chain” competition is real.
There are thousands of business texts and techniques available that describe how to succeed in business. They have a common theme -- subscribe to a mentor, develop a formal plan and balance your ideals. No one plan works for everyone, but only those with a plan succeed.
Prior to developing a business plan, or any plan, one needs to have some philosophies behind the plan. This is the glue in a successful plan.) Let me share what some of these beliefs might be. However, these beliefs need to be yours, not someone else's.
The Pareto Principle or the 20/80 rule says 20 per cent of the people accumulate 80 per cent of the wealth. It also implies that 20 per cent of the time gets us 80 per cent of the results. Twenty percent of our customers give us 80 percent of the business.
The 20/80 rule applies to most things, such as 20 per cent of producers produce 80 per cent of the pigs, and 20 per cent of the producers accumulate 80 per cent of the wealth. What are the 20 per cent of the things you do that give you the biggest bang for the buck?
The Conspiracy Theory implies that “someone is out to get me,” whether it be government, big business, rules, society, the mother-in-law. Don't flatter yourself. No one cares and no one wants to harm you. The big brother to the South is not out to shut us down – he’s not that smart. Get over it!The most difficult barrier to break is the mental one. For centuries, it was thought to be physiologically impossible to run the four-minute mile. Roger Bannister did so in 1954 and the following year four people broke it; now it is commonplace. The same mental barrier exists in most minds, including pork producers. Are 30 pigs per sow per year, Canada Brand, or enjoying your business, a mental barrier?
Information travels around the world in nanoseconds and knows no borders. As a result, competitive advantages exist globally, not locally. The information available to us doubles every 10 years; therefore our forefathers, 30 years ago, succeeded on 12.5 per cent of the information we have. The lesson is that information is not the limitation, it is the use we make of that information that gives us the competitive advantage.
What is your competitive advantage? A common boardroom statement is that if you don't have a competitive advantage, don't compete. Innovation, too, has no borders.Dwell on the solution, not the problem. We are what we think and if we allow ourselves to be inundated with all the negative news, problems, aches and pains, we will not have the mental fortitude to focus on the solution. The solution often includes a team approach, a positive attitude and a will to succeed. Focus on the solution, not the problem!
Lastly, know your mission. Whether in your personal life or in business, intimately know your mission, then develop your plan to succeed as an “Apprentice” -- appreciating that the mission is being “The Apprentice” in the Pork Value Chain, not the Donald Trump. BPRichard Smelski is general manager of Ontario Swine Improvement Inc. and a former Ontario government swine specialist.
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back Breaking down the barriers on Source Water Protection
The provincial government's plan suggests that the outcome will be a win-win for everybody. Where have farmers heard that before? As with the Nutrient Management Act, the devil may be in the details.by Murray Blackie
BP
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