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The Rural Voice, 1995-10, Page 571 PERTH iftk County Pork Producers NEWSLETTER John VanNes, President 519-393-6479 • The Rural Voice is provided to Perth County Pork Producers by the PCPPA. Price is pork producers' No. 1 concern Any opinions expressed herein may not necessarily reflect the views of the Perth County Pork Producers' Association. Ask any pork producer what their No. 1 concern is for the Ontario pork industry today and the answer you will most likely receive is "getting a fair price for our produce." Producer frustration has been increasing, even though prices have been strong as of late. The packers claim they require more hogs to keep their lines running efficiently at the same time as more weaners are being shipped into the U.S. Weaners shipped into the U.S. for the first six months of 1995 totalled 118,000 with 22,000 shipped in June alone! That is double the number shipped in June, 1994. It is no wonder, then, that this topic dominated the discussion at the September meeting of the Perth County Pork Producers' Association. As our guests. at the meeting, we had the CEO of Ontario Pork, Julien Den Tandt, and Rick Scaggs, who is responsible for the Sales and Market Development Division at the Board. Julien began by speaking about the Agrimetrics comparison report that was completed and released to the Board in August. Julien explained that Agrimetrics is a U.S. based company that was hired by both the Board the packing industry to independently assess what the Ontario packers pay for hogs versus their American counterparts. The Board felt the study was required so that a truly independent and unbiased analysis of a sound price per kilogram of lean meat comparison with U.S. could be acquired. The results of the study clearly show that Ontario hogs are superior in quality to U.S. hogs. While many of the directors were expecting to hear exactly what the difference in value between the two countries' hogs actually was, Julien explained that the difference could not be announced at this time. The reason for this was that Agrimetrics received information from the U.S. packers under confidentiality agreements which have to be honoured for the time being. Julien did say that the difference in value was very much in line with the Board's historical calculations of the U.S. packers' costs of purchasing hogs. The members of the Negotiating Committee, who are Julien, Rick and Mary Lou McLeod, Communications Manager at the board, as well as directors Joanne Rombouts, Carl Moore, and Helmuth Spreitzer, will be meeting with packers in September to attempt to bring Ontario prices in line with prices in the U.S. One of the ways that this could be partially accomplished is by removing the divisor of 105.7 from the formula. The formula takes the U.S. price and divides it by 105.7, which is the average index of hogs in Ontario at this time, to reach a base price for a 100 index hog. There has been a lot of criticism of this practice, because it assumes that the average hog in Ontario and the U.S. is of the same quality, which the Agrimetrics report shows is not true. The Negotiating Committee has attempted in the past negotiations to have the divisor removed, but the packers have rejected this move. The Agrimetrics report gives the committee the facts it requires to meet this challenge. There was some discussion as to what would be the Board's next move if the packers failed to bring Ontario prices in line with their U.S. counterparts. It would seem from some of the comments from Julien and the directors present that formula pricing would probably be dropped, and the Board would actively pursue other markets, both inside Canada and the U.S. The Board has been meeting with representatives from packers in the U.S. over the summer months, to re-establish relations with these packers. Of course, countervail will still reduce the returns received from the U.S. market (the current countervail rate is 1.34 cents per pound liveweight or about $3.20 per hog), but perhaps bidding would be brisk enough to give us a positive return by selling into this market. A new packing plant is coming on stream shortly in Indiana which will increase competition in the U.S. market. The next couple of months should show us how successful the negotiat- ing committee will be, armed with the facts contained in the Agrimetrics report. Hopefully, it will go a long way in bringing Ontario producers parity with their American counter- parts. The success of these negotiat- ions could well mean the difference between the Board being the main marketer of hogs in Ontario, or a time in which the Board will not be the do- minant marketer and producers look at other options to sell their hogs.° Thank you to our sponsors The Perth County Pork Producers' Association wishes to thank the businesses that donated to our annual Golf Tournament. We wish to thank John Moore Insurance for the pork burgers enjoyed at lunch, and Ken Pal Farm Products and Perth County Co-op for the excellent supper. We would also like to thank our other sponsors for supplying the door prizes for the day. Thanks again.° PERTH COUNTY PORK PRODUCERS' PORK PRODUCTS • Smoked Pork Chops • Fresh Pork Chops • Stuffed Loin Chops • Smoked Sausage • Smoked Cheddar Sausage • Pork Burgers • Bacon Burgers • Boneless Rib 0' Pork • Teriyaki Pork Steaks • Bruce Packers Summer Sausage • Vittorio's BBQ Sauce AVAILABLE FROM: Fred de Martines (Sebr.) 393-6812 Dennis Zehr (Brun.) 595-4771 Martin van Bakel (Dublin) 347-2666 OCTOBER 1995 53