The Prairie Swine Centre's role - helping the industry rebuild

Monday, February 3, 2014

Sow numbers have declined more than 20 per cent since 2005. Rebuilding attitudes, re-engaging employees and keeping governments and financial institutions informed will be key to the industry's redevelopment

by LEE WHITTINGTON

When is the right time to talk about rebuilding? The weather in North America makes front-page news every week, highlighting natural disasters. Add in the pipeline spills, man-made flood diversions and train derailments, and the range of disasters that have beset people in the past year is large.

But it is the reaction of people to those disasters which is most telling. Though there are a variety of challenges, large and small, the response from those affected is consistent. Rebuild.

The pork industry has endured a series of problems, leading to a decline of more than 20 per cent in sow numbers in Canada since 2005. The challenges just kept coming for eight years – circo virus, avian/swine influenza, the exchange rate of the dollar, feed costs, ethanol policy, Country Of Origin Legislation (COOL)  – with each new season bringing a new blow to our industry. So what should we do? Rebuild.

Rebuilding the Canadian pork industry doesn't necessarily mean new barns. It starts first with rebuilding our attitude about our business, re-engaging employees in a discussion about their careers, informing financial institutions and governments about what redevelopment will mean.

This article is built on the premise that things get better or worse, but they do not stay the same. For the past 25 years, we have grown accustomed to an industry with unlimited growth potential. A similar but shorter period took place in the mid-1970s when we "skipped a portion of the four-year cycle" and hog prices rose when they traditionally should have declined, fuelling a surge in investment. I was in university at the time and had classmates considering dropping out to join an expansion in the family business. Some did, and successfully built careers from that moment of change.

Here are some key changes facing the industry now:

• Productivity in our barns across the country has never been better or more consistent.
• Reinvestment on a large scale is starting to take place. Think the Shuanghui-Smithfield transaction and similar game-changers with the companies we know in Canada.
• Grain prices are moving in the opposite direction to the past three years and stocks are projected to be catching up to increased usage growth.
• World prices for pork are rising, some because of the latent effect of high feed prices, some driven by increased appetites and restricted access to pork outside North America.

Of course, not all change is pointing in the same direction. There are significant limitations to financial resources and some changes, such as the north-south trade in pigs and pork, will not "return to normal" in the short term. As a research centre serving the knowledge and technology needs of the industry, we at the Prairie Swine Centre are rethinking what pork producers will need now and in the next decade and how should we address that need.

Some challenges that are being identified and will need to be addressed in our next five-year business plan are listed below:

1) Welfare codes. Will the added investment result in added income for producers and better welfare for pigs?

2) Barn age and condition. The 1990s building boom has reached a maintenance milestone. New investment and technologies are required to prepare these structures for the next 20 years.

3) Global growth and interdependence. These can result in new challenges like Porcine Epidemic Diarrhea (PED).

4) Avoiding complacency on diet costs. Keep implementing those practices that helped us survive 2012-13.
5) The changing face of our labour force. How are we contributing to a trained, safe and loyal workforce?

6) Keeping cost of production low. Given a dollar to spend, where is the best investment? Do we have the tools and expertise to answer that confidently on a farm-by-farm basis?

7) Investment in new technologies for livestock production. Will companies invest in technology development for swine if current trends to protect markets (removal of ractopamine) and create new niches (removal of antibiotics) seem to focus on what to take out of pork production? There is an ominous trend to reject technology rather than making the best use of science to improve growth, efficiency and product quality.

It is our promise to you that we are and will be addressing these challenges and others. The Prairie Swine Centre downsized, economized and modified how it does business over the past five years as a result of the many external pressures on the industry. But through this change the Centre worked to maintain its unique mandate and mission.

As we develop the next five-year strategic plan for Prairie Swine Centre, we will be seeking your insight and guidance on what the right questions are and how we should be addressing them.

The industry will rebuild and we are committed to looking for the opportunities. Our role is addressing the use of technology as producers redevelop their business models, providing the type of information governments and financial institutions need to re-engage with industry, and generating the breakthroughs that attract the attention of young people to seek careers as veterinarians, stock people, service people and researchers. This will take time. BP

Lee Whittington is president and CEO of the Prairie Swine Centre in Saskatoon.