Alberta Pork industry adapting to meet market challenges

By Tim Kalinowski, Staff Writer

Alberta pork producers have had a particularly hard road for the last decade or so. Many have gotten out of the industry already, but for those who remained in through the tough times they are starting to see some improvement.

“When you look at this industry it is a lot of dedicated and hard-working people, who are out there to feed the world,” says Darcy Fitzgerald, executive director of Alberta Pork. “When you look at the cycles they go through, the average person looks at that and says why don’t you just get out? But you can’t. You’ve got a pipeline of animals already there and you can’t walk away from them. So you sit there and lose money for a long time before it starts to come back up again. Now we’ve gotten to the point where we have just sort of filled in the hole to get the banks happy again.”

Fitzgerald says the last thing the 500 pig operations in Alberta need right now is to be undercut by government regulations which respond to an activist point of view rather than those of producers. He gives the example of Bill C246 to illustrate his point.

“In that bill there is a number of issues there the general public should be aware of. We look at the procedures and processes we use to euthanize animals. If an animal is sick, you can’t let it suffer. If its life needs to be terminated because that is the best thing for it, then we need to do that. What puts things into question with this bill is that all the processes we use could potentially be deemed “cruel” by the language of the bill.

“Those kinds of bills, while maybe well-intended by a member of parliament, when you put it back into the farming practice where you are dealing with thousands of animals, we have to make sure we can euthanize animals sometimes quickly to end their suffering. What this bill does is open the door for groups, and it’s a very small fraction of groups who are very vocal, to use this to look at how can I shut down animal agriculture?”

That’s not to say the pork industry takes concerns about animal cruelty lightly, says Fitzgerald. Far from it.

“We are always looking at ways to see how we can improve the way we handle animals,” he explains. “We had a new (handling) code come out last year that we have accepted as an industry to take on. We have a lot of challenges there, and we now have timelines to meet those challenges. And we will do that. We will meet those challenges.

“The way we look at it is the healthier and happier that animal is the better it for us as individuals working with them and as a business. The vast majority of people in our industry do the right things for their animals, but what it is, is sometimes you need to show the public you are doing the right things. We will not stand behind somebody that is outrightly cruel to his animals; who outrightly breaks the rules. We don’t want guys in the industry who do that because it hurts everybody.”

Fitzgerald gives the example of the Canadian pork industries’ voluntary decision to end the use of the growth drug Ractopamine, which some countries have banned outright due to perceived risks to human health. The drug is still widely used in the American pork industry.

“Because our trading partners said we don’t want that in our product, we changed almost over night,” remembers Fitzgerald. “That was huge for our industry. Realistically, not every producer used the product, but it was a loss for the producers who did. But we understood if we want to trade with certain partners we have to do what they want. There are lots of examples of these kinds of things we do on a voluntary basis, we put these rules on ourselves. We don’t need the government to tell us that.”

While challenges remain on the regulation front and on the labour front for pork producers in Alberta, Fitzgerald says nothing vexes his members so much as ongoing uncertainty in their costs and in their pricing. Producers want to feel confident they can survive long term in this industry.

“I think one thing producers don’t have in the hog industry is any good backstops on business risk management. There are not really good insurance programs to ensure where I am going to be if I am a hog producer. There is no good forward contracting abilities, to sit with a supplier and say could we fix the price so I know next year what I am going to get? We are not dealing with things that are luxury goods here when we talk about this, we are dealing with the basics of food. To some extent, we can watch a food supply come and go. As we are one of the few countries left with a food supply we can export.”

Fitzgerald says this does not mean producers want some form of supply management, just more ways to offset their high risk loads.

“If I were a producer, I would love somebody to come in and say we are going to have to pay you X number of dollars. You will make a profit, and this is what you need to do for us, and for the next 25 years you are guaranteed to get a price. That would be fantastic. We don’t have that in our industry, and if we could get a little more towards that I think it would really help out.

“It’s not supply management, it’s just what I would say is having a good relationship with those in the supply chain to understand what your costs are going to be.”

On the positive side, Fitzgerald says there is a demand out there for Canadian pork, which exports to about 100 countries at the moment.

“When we look at the demand for pork products, there is a growing middle class around the world, and a growing concern in these countries for the quality of products they have, and the trust in those products. That gives us a real advantage. That is why we are selling over 70 per cent, because those countries see the health and safety processes we have in place over here and have confidence they are going to be getting a high quality product.

“That is where we want to be. We want to be the high end market. And with the volume we have, we think we can do that.”

While export volumes have been fairly stagnant in recent years, Fitzgerald says there are definitely statistics in his industry’s favour which show a potential for greater growth in the future.

“If you look at it from the perspective of who grows the most pigs, it’s definitely not us. But who exports the most pigs? We are right up there. Canada is number three. And Alberta, as a producer, is the fourth largest in the country. Canadian pork a great product, and it’s fabulous nutritionally. There are cuts of pork that are as lean or leaner than chicken… So there are a lot of positives.”