Manitoba offers $60M in loans to hog industry

Manitoba's government is making $60 million available to help livestock producers struggling to deal with soaring feed costs, low livestock prices and the high Canadian dollar.

Hog producers will be able to borrow $35 per slaughter hog and $10 per weanling sold between Oct. 1, 2007, and May 31, 2008, at "attractive interest rates," officials said Thursday.

"The livestock industry in Manitoba and across Canada has been under significant pressure," Agriculture Minister Rosann Wowchuk said Thursday in a release.

'It's chaos. It's disaster.' Lorne Penner, hog producer

"Producers in Manitoba need assistance and our government is committed to ensuring our farmers in this important sector receive support to maintain their farm businesses today and position the sector for future profitability."

Hog broker Boyd Penner said he's seen two dozen local producers close down in the last few weeks, their operations collapsing under the financial pressures.

"I just can't make them any money. I sell their pigs, I move their pigs, and I just can't make them profitable," he said.

The provincial government put a moratorium on new hog barns and expansions in November 2006 while it examined the environmental sustainability of the industry.

Some producers have complained the moratorium has added to their troubles, but Penner says it may have turned out to be a blessing in disguise.

"It was actually a good thing, because it would actually stop people from making more mistakes, more expansion," he said.

Animals could be 'worthless'

Adding to the uncertainty are fears that aproposed food-labelling law in the United States couldshut Canadian producers off from American customers, who are currently the main buyers for Manitoba hogs.

The country-of-origin labelling initiative would require American processors to segregate meat from Canadian animals and add to their packaging and labelling costs, which could make packers and producersreluctant totake onCanadian animals.

If passed, the new rules would take effect Sept. 1.

Hog producer Lorne Pennersaid he plans to euthanize his animals if he can't sell them south of the border in the fall.

"What else can you do?" he said. "We're pumping $5,500, $6,000 of feed into them every day. If there's no market, if they're worthless, that's all there'll be left.

"Thousands and thousands, hundreds of thousands of weanlings will probably have to be gassed because there'll be no market for them."

Penner said he's already losing about $30,000 per week on his operation, and is only staying afloat because he makes his own feed.

"It's chaos. It's disaster," he said."It looks very dark. It looks very grim at the end of the tunnel."