Sask Pork GM Mark Ferguson shares what's new in hog production with Saskatchewan farmers

Sask Pork recently opted to join Agricultural Producers Association of Saskatchewan (APAS) as a Group Member. APAS works with a variety of livestock-based groups to be more involved in the advocacy for livestock sector issues. The following interview with Sask Pork General Manager Mark Ferguson is an excerpt by Ryan McNally from APAS’ Saskatchewan Farmers’ Voice Fall 2022 Edition re-published with permission.

Q: What are some of the major projects that Sask Pork is working on?

A: Research is a big component of our programming, we annually fund about $350,000 in projects, and that’s about 20% of our levy revenue. We do research at various institutions across Canada, the main one though is at the Prairie Swine Centre near Saskatoon. Basically, our research programming looks at three different areas, and the first one – and pretty important considering what happened this year with the drought – is nutrition research, so that’s basically improving the income of producers through improved diets, improved uses of ingredients, things like that. We research ethology, which focuses on animal behaviour, animal welfare, how do we improve the environment of the barn and how we handle animals, and so that’s another area of research. We also do engineering, which focuses on the physical environment, how the barn is constructed, energy efficiency, the environmental footprint, and that type of thing. In terms of research projects, those are kind of our main adopt them, it does reduce their cost and improve their net income. The investment in research by producers has real dollar impacts at the farm level, and we try to keep our research as practical and applicable at the farm as possible.

Q: Why did Sask Pork decide to join APAS as a Group Member?

A: We’ve been an Associate Member of APAS for many years… We benefit from working together to achieve a common goal, and having a strong general farm organization like APAS to work on behalf and represent all of agriculture is an important thing to have, an important contribution, and it’s one that we’re proud to be a part of as pork producers.

Q: Was your organization impacted by drought either last year or this year?

A: As feed users, the past year was very difficult for farms. Basically, what we had to do was move to importing the majority of our feed requirements. Instead of using barley and wheat, we were using corn imported from the U.S., and so that introduced a lot of logistical challenges, and feed costs were also up by about 40% year over year. Feed costs make up about 70% of our total cost of production, so you can imagine the impact on the farms was immediate and significant. The drought had a big impact. At the same time, we were fortunate that our hog prices were actually historically strong over the past year. We had very strong hog pricing, and while it didn’t always mean that the farms were profitable throughout the year, it did help. Especially this summer when we had some good prices, and with feed costs coming down a bit, I think some of the farms were able to make a little bit of money. But it was a tough year for (our producers).

Q: Do you find that there’s more hog producers year over year, or is it steady/declining?

A: The general trend on the number of hog producers in the province has been declining. We’ve got under 100 commercial hog producers at the moment, there are many more people that raise hogs on a small-scale basis, but in terms of people where that’s their company, or that’s their livelihood, there’s under 100. Basically, it’s the economics of the business, so most of our slaughter facilities are located out of province, so there’s a long trip to the abattoir for the hogs, and so you’ve got to be able to build larger semi loads of animals in order to make it work. Over the years from what I’ve seen in the business – and I’ve been with Sask Pork for about 17 years now – that trend, a lot of it is the economy and scale are driven by transportation, and that’s the reality of it. While we have seen fewer farms, we are seeing larger farms, and the number of hogs in Saskatchewan has actually grown over time.

Q: What’s on the horizon now for Sask Pork?

A: We want to continue to see good agricultural policies and programs in Saskatchewan and in Canada. Some of the things we talk about on the policy side is ‘if we could just have a more effective means of forward pricing our feed grains, it would be a huge benefit to the industry. We’ve got fairly good systems in place to hedge or forward price our hogs, but there’s really no effective futures market for feed wheat and feed barley in western Canada, so especially over the last year, very difficult to manage risk on the feed side other than pre-buying and taking a delivery in advance of feed, so I think that’s a good example of why we need better tools in terms of managing feed risks.

Another issue that’s important to both existing producers and potential producers is our Intensive Livestock Operations (ILO) Permitting system in Saskatchewan, and it could use some significant improvements. It’s currently a very long and uncertain process for anyone thinking about building or expanding an intensive livestock operation. It’s a set of rules that hasn’t really been updated since the 1990’s when it was developed. Some of the ways discretionary use is deployed by municipalities has been an issue over the years, so we would like to see some changes made there. We would like to see the industry grow in Saskatchewan as well. Saskatchewan is one of the best places in the world to raise hogs, in most years we have an abundance of feed, we’ve got a large land base with very little existing livestock out there, so that means we’ve got a low environmental risk, and those are some of the advantages we have.

As we’re seeing with the way fertilizer prices are going, manure is a valuable and sustainable resource that I think provides a great financial benefit to those fortunate to be located close to a barn. In terms of the hog industry, we would like to see more units developed in the coming years, and there are lots of opportunities to work with some of the established companies out there to finish hogs for anyone that’s interested. We’d certainly like to talk to anyone who is interested in ever having hogs on their farm.

Q: What are some of the other hurdles of operating a hog farm?

A: It’s got a high initial investment to get a barn built right, and with construction costs, we know that that’s an issue in a lot of sectors. Volatility in feed costs and hog prices are always going up and down, and actively managing that risk is an important part of being a hog producer and hedging those commodities when you can or prebuying feed so that you’re not exposed to those risks. In Saskatchewan, we talked about before the distance to the processing plants can be an issue as well. We’ve got one processing facility located in Moose Jaw, which does slaughter about 300,000 hogs per year, we produce about 1.8 million, so the rest of them go out of province and have a higher transportation bill.

Q: What work can be done to address these hurdles?

A: Some of them are pretty difficult ones in terms of construction costs – that’s a tough one that effects every sector in the province – I’m not sure what the solution on that is. I think there’s some tools that could perhaps be developed in terms of managing risk on feed, and we talked about the ILO permitting as well, which could be redeveloped or enhanced to make the process a little easier.

Q: What’s one thing that Sask Pork needs right now?

A: We just want to continue to have good agricultural policies and programs in the province and to continue to have a good voice for those things.

For the full article and the full Fall 2022 issue, please visit Saskatchewan Farmers’ Voice at: sfv-fall-2022-for-web.pdf (apas.ca)