Major Quebec pork industry players agree on prices

Quebec pork industry struggles Days after Olymel announced it a major pork plant closure, Quebec producers have a new pricing agreement, but it’s been tough for farmers.

The main players in the hog industry have agreed on a new pricing formula to define the price of animals sold to slaughterhouses.

The Hog Marketing Agreement was made public Tuesday.

It marks the culmination of a conciliation process led by former Charest government finance minister Raymond Bachand since August.

Bachand presented the agreement earlier Tuesday to Agriculture Minister André Lamontagne, accompanied by David Duval, president of the Éleveurs de porcs du Québec, and Yanick Gervais, president and CEO of Olymel.

At the end of the meeting, Lamontagne stressed the importance of solidarity in a difficult context for all industry players.

The agreement comes at a time when the Quebec pork industry is dealing with an unprecedented crisis, in a context of a closed Chinese market, supply chain disruption and labour scarcity.

Olymel, which controls nearly 80 per cent of the pork processing industry, says the sector has incurred $390 million in losses over the past two years.

The restructuring cooperative has closed five facilities in recent months, including the Vallée-Jonction hog slaughterhouse, whose closure was announced last week. Nearly 1,000 workers will lose their jobs.

Olymel's difficulties are having an impact on pig farmers, whose income depends on purchases from the cooperative.

Farmers have been forced to sell at a loss to Olymel for the past year due to a reduction in the purchase price. This loss was then compensated by the farm income stabilization insurance program (ASRA) managed by the Financière agricole du Québec (FADQ).

The cooperative also intended to reduce its hog slaughter by 20 per cent starting in June. In this difficult context, the Éleveurs de porcs du Québec has adopted a voluntary buyout program for producers who will withdraw from production for at least five years, with the goal of reducing the number of hogs raised in Quebec by one million.

This report by The Canadian Press was first published in French on April 18, 2023.