Canada’s largest pork producer is closing down farms and laying off staff in Alberta and Saskatchewan in response to low prices..Quebec-based Olymel LP announced it will be closing five sow units in southern Alberta and one in Saskatchewan to reduce its pig herd by about a third to about 40,000 sows. About 80 employees have been laid off..In a news release, the company said the closures would result in a net reduction of about 200,000 market hogs annually to its Red Deer slaughter plant. The barn themselves will be wound down over the next several months and remain closed until market conditions improve.. Hog pricesCanadian hog prices. ."Over the past two years it is well documented Olymel experienced significant losses in the processing of fresh pork as a result of limited market access globally,” said Olymel CEO Yanick Gervais..“Now coupled with stubbornly high feed costs resulting in unprecedented losses in the hog sector, we have little choice but to retract and position ourselves for success in the future when conditions improve. I am confident the changes being implemented in Olymel's Western Canadian integrated hog sector will provide the foundation for ensuring that success.".It comes after the company closed farms and processing plants in Quebec in February and again in April, affecting more than 1,000 unionized workers. Last October it reorganized its front office, eliminating 177 management positions..Olymel is the country’s largest producer, processor and distributor of pork and poultry products with annual sales of about $4.5 billion, a third of which is exported. . Canadian pork export marketsCanadian pork export markets. .It’s those export markets that have suffered. Chinese imports of Canadian pork dropped 67% in the first quarter of last year amid trade disputes while US shipments dropped 56%. Meanwhile, feed costs rose due in part to the war in Ukraine..Canada is the third largest pork exporter in the world with more than 7,000 pig farms producing about 25 million animals a year compared to 3.5 million cattle. However, farm cash receipts amounted to $6.5 billion in 2022 according to StatsCan, or 7% of all farm receipts compared to $11.8 billion or 12.5% for beef.
