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The Rural Voice, 2001-06, Page 24This little piggy needs a market Ever since the 1998 market crash when too many pigs chased too little processing capacity, access to a share of the marketplace has been a growing concern to some non -contract hog producers By Keith Roulston Qn April 26 Progressive Pork {'reducers Co-operative Inc. announced it had reached agreement with Conestoga Meat Packers of Breslau to purchase the company and process members' hogs. Late last fall Acre T Farms of Brussels announced partnership with Larry and Glenn Tulpin of Norfolk Packers in St. Williams to form Oxford Packers. Currently approvals are be being sought to build a 5,000 - head per week kill and chill plant in Mitchell, 50 per cent of the capacity of which will come from Acre T. Is vertical integration now moving to a bottom-up phase? Will farmers have to "buy" shackle space in the future if they want to be guaranteed a market for their pigs? The answer seems to be no — for now, but who knows in the future? Certainly there are concerns south of the border where huge integrated companies control hogs from the farm right through to wholesale distribution. When he spoke at a forum on competitiveness in 20 THE RURAL VOICE With more and more hogs sold under contra' t to packers, should independent hog producers be concerned about their future markets? Some are, and they're doing something about it. Shakespeare in December 1999, Wayne Snyder a buyer for Farmland Industries Inc., a large producer - owned pork processing co-op in the U.S. midwest, said the key for a farm to be competitive is to have access to a market. its no longer good enough to be a low cost producer, Snyder said. He told of turkey producers he knew of who were low cost producers but when the packing plant that bought their turkeys closed, they were left without a market. In pork, the contraction of the open marketplace has come from vertical integration of an industry where packers answer the demands of consumers by trying to create a consistent product. In the U.S. it has led to companies like Tyson Foods Inc. and Smithfield Foods that control pigs from choosing the genetics to providing the feed to a consistent production formula to slaughtering and processing. In Canada the packers haven't followed the American example by getting into production of hogs but companies like Maple Leaf Foods now fill the major part of their capacity with pigs contracted directly from producers. The old single desk system run by Ontario Pork, once the trading centre for all pigs on Ontario is long gone. Ontario Pork has become "irrelevant", one disgruntled producer said. When Bob Hunsberger, vice- president of Progressive Pork Producers (PPP) first got involved in trying to form the co-operative eight long years ago, the idea was to create an additional market for Ontario hogs. At that point the co-op hoped to build a large kill and chill plant in London. Over the years that plan has evolved and the Conestoga purchase moves the company in another direction, adopting a "gate -to -plate" strategy of vertical integration from the farm to the wholesale level,