Repeal of COOL Has Limited Impact on U.S. Demand for Canadian Market Hogs

Jan 07, 2016

By  Bruce Cochrane.

H@ms Marketing Services reports so far the repeal of U.S. COOL has a had a minimal impact on U.S. demand for Canadian market hogs.
Just before Christmas, the U.S. suspended the enforcement of provisions of Mandatory U.S. Country of Origin Labelling for pork and beef following passage of legislation which included repeal of those provisions.

Perry Mohr, the general manager of h@ms Marketing Services, says, so far, the change has a limited impact on U.S. demand for Canadian slaughter hogs.

Perry Mohr-h@ms Marketing Services:
Much throughout the month of December the U.S. processors were slaughtering at capacity.

Many of them were slaughtering 5 regular days plus a Saturday and there was even Sunday kill so they're not really in a position right now to entertain taking more hogs.

In the longer term, that's going to change.
The USDA put out their fourth quarter report on December 23 or 24 and it indicated that they expect hog numbers to drop off early in the new year.

We are dealing with a situation currently where we had 2 slaughter reduced weeks due to the Christmas Day and the New Years Day holidays so there's a little bit of a backlog in the States.

But we do expect, by the third week in January, that the U.S. slaughter could be below 2.3 maybe even down to 2.25 million head which could in theory create an opportunity for the U.S. processors to look outside of their normal buying patterns and look up here into Canada.

We do know that there are hogs available specifically in Ontario that have been flowing.

Some of them have been going into Quebec.
Some of them even have been coming all the way to Maple Leaf in Brandon to find homes because of the lack of slaughter capacity in Ontario right now.

Mohr says repeal of COOL is relatively new news and it will take some time before we can we can fully determine the impact of the change on hog flows and prices.

Source: Farmscape