New Study Looks at Prospects of Made in Canada Hog Pricing

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Farmscape for November 15, 2019

Full Interview 9:32 Listen

The prospects to establishing a “made in Canada hog price” were examined this week as pork producers gathered in Saskatoon.
The Canadian Pork Council’s “Made in Canada Hog Price Formula Project” was discussed this week as part of Saskatchewan Pork Industry Symposium 2019. Catherine Brodeur, the Vice President Economic Studies with Groupe Ageco, explains there is an interest in creating formulas to better reflect the premiums paid for Canadian pork over U.S. pork in certain markets.

Clip-Catherine Brodeur-Groupe Ageco:
We looked to asses the value of Canadian pork and the difference in the value of Canadian pork compared with the U.S. pork in our main export markets as well as the North American market. We conducted interviews with buyers in  Japan, China, Mexico and the U..S., buyers of Canadian and U.S. pork to assess their perception of the value of the Canadian pork. We looked also to trade data to see if there was a premium for Canadian cuts over American cuts in those markets. In the Japanese market we observed a real premium for Canadian product over thee American product but, for the other markets, we can not pretend that the Canadian product is sold at premiums compared with the U.S. product.
Some buyers will prefer the Canadian product for a specific attribute they have in other markets but they will prefer the  Canadian product if it’s at the same price as the U.S. product so we can not translate that into a premium for the Canadian product.

The final report proposes three possible pricing options. Brodeur says, because the of integration of the North American market Canadian prices should continue to include a U.S. reference price and premiums to reflect the Japanese premium and Ractopamine free pork.

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