People aren’t the only thing Manitoba needs more of. A shortage of slaughter pigs continues to be a nagging problem.
Maple Leaf’s Brandon facility struggles to keep a second shift operating at capacity, searching for additional hogs to process, while HyLife has gone outside the province to keep its Neepawa plant at capacity.
“We are always looking at options in trying to grow our finishing production to make sure we keep our plant in Neepawa full,” says HyLife’s executive vice-president Claude Vielfaure. “We, unfortunately for Manitoba, have looked at Saskatchewan a few times over the last few years and bought some barns there.”
It’s not that HyLife doesn’t want barns in Manitoba. Instead, it’s that stringent environmental regulations have made building or replacing those barns difficult if not impossible in recent years.
“We certainly have two big packing plants in Manitoba that need pigs and need consistent pigs,” says Vielfaure. “So replacing facilities is extremely important for our industry to survive.”
A decade ago, the governing New Democrats established a temporary ban on new hog barns. Two years later the provincial government introduced a moratorium on new barn construction in 35 municipalities, and in the lead up to the 2011 provincial election the government again increased restrictions on hog operations with the Save Lake Winnipeg Act, effectively making the building of new or expanded barns cost prohibitive by mandating a yet-to-be developed anaerobic digester.
Relief came in the spring of 2015, when then agriculture minister Ron Kostyshyn announced a pilot program dropping the anaerobic digester requirement in favour of a two-cell lagoon system, coupled with new soil phosphorus regulations.
Already, the Manitoba Pork Council has received two applications and several inquiries from those wanting to construct new barns, its general manager Andrew Dickson says. However, finding the capital for new construction could be just as big a barrier as the so-called moratorium.
There has been some progress, however. Farm Credit Canada recently stepped in to offer loans worth up to 65 per cent of the cost of new construction, provided the cost is not more than $500 per pig. That still leaves producers searching for the remaining 35 per cent, in addition to annual working capital of about $400,000 for an average-sized finisher operation.
“You’ve got to be able to show cash flows that demonstrate that you are going to be able to service that debt,” Dickson says. “It’s not like you go down tomorrow and just pick up a cheque.”
For Mohr, building new barns is all about the capital and not so much the regulations.
“Expansion will be triggered by profitability, just because the packers need hogs, it doesn’t mean that people will build barns,” Dickson says. “Frankly, we haven’t been profitable long enough to get people excited about expanding, including the banks.”
Yet Dickson says Manitoba needs to finish an additional 1.3 million hogs each year for packers here to be as efficient as their American counterparts, which would require the construction of at least 80 barns, each with a 4,000 pig capacity. While Manitoba produced eight million pigs last year, only 4.53 million were slaughtered in the province. The remainder went south to the United States as weanlings.