Caring for Land

Farming until one runs out of money

Kevin Farrell is a hog farmer in Centre Hastings. Two years ago, he said he thought farming was going sideways now he thinks it is going downhill fast. He gave up a well-paid office job to farm with his farmer Doug Farrell.

“We ship 80 pigs a week and are a farrow-to-finish operation," said Farrell. “All the pork producers sell through the Ontario Pork marketing board.

“We ship to Olymel in Quebec, which is the largest packers in Canada.

Olymel is a massive operation and is producer owned. said Farrell. In Ontario Ontario Pork sets the price and there are two big packers, which nproduce pork cheaper then Canada. America pork is sold in stores at $1.99, which is cheaper than both Ontario and Quebec pork.

“Dad has been raising hogs since 1960s,” said Farrell. “He came in on the ground floor. Before that every farm had a few pigs. He has seen the ups and downs of the hog cycle. When the price is really good people get into hogs

The gestation period for pigs is only three months, three weeks and three days. Pigs can be finished in five months therefore by ten months every one has pigs to sell.

The game have fundamentally changes one is not competing against one’s neighour to be a better farmer by running a tight ship and being a little bit better than them.

Province of Quebec guarantees the cost of production for their farmer. This doesn’t happen in Ontario.

Olymey packers is restructuring and had to close two or three plants

“The industry is really struggling,” said Farrell. “Labour costs in Canada are highest cost in North America. Labour is the biggest cost for packing plants.”

Circovirus hit swine in North America. "It is like AIDS in pigs," said Farrell. "Normally we have really low losses less than .35 per cent and it is not an issue. With Circovirus pigs die suddenly. We couldn’t work out how did it get into a closed herd. The vets' bills were huge."

“We are buying in semen and the company said the virus was not transferred in the semen, but it was,” said Farrell.

The American hog industry had a leg up time because the government approved a vaccine quickly and they got a competitive advantage, said Farrell. The Canadian government worked hard on a sow vaccine.

"This has made a huge difference," said Farrell. "Piglets get immunity until the last month and half. Now we are switching to a piglet vaccine, which will give them immunity all the way through life."

The nation is now flush with pigs. The Canadian dollar is up, which affects exports of pork.

"The US puts extra duty on pork for Quebec as the Province of Quebec subsidies the hog industry," said Farrell.

"The big barns (corporate farms) seem to be able to go bankrupt and then get back into production by setting up a new company. If a farmer declares bankrupt they have nothing, as Farm Credit Canada values buildings that are more than five years old at zero.

The value of the farm is only the value of the land minus the demolition cost of removing the buildings, sadi Farrell.

“One needs to get out of hogs as it is a global problem. The levels of protein production are too high,” said Farrell. "China is producing as much pork as the rest of the World put together. Multi-national have plants in Brazil, Argentina and other South America countries. One can’t comprehend the size of these operations."

Farmers in Ontario are competing and having to deal with regulations. "We have to deal with nutrient management legislation, quality assurance, feed standards, and animal welfare regulations," said Farrell.

"New Country of origin regulations are a can of worms U.S. mCOOL," said Farrell.

“Depending on the version of mandatory country-of-origin labeling (mCOOL) passed by U.S. legislators, the extra costs labeling presents could drive U.S. packers to avoid buying Canadian livestock, force Canadian producers to sell it to them at a discount, or distribute it into retail channels not affected by mCOOL legislation,” says Kevin Grier of the George Morris Centre, a prominent agricultural industry think-tank in Guelph, Ontario.”

It could cause a major shift in hog production as ten per cent of hogs packed in the States originate from Canada as nursery or grower pigs, said Farrell. Some companies have farms on both sides of the border Nobody knows for sure what the effect will be and nobody cares, said Farrell.

He thinks mCOOL is going to be an issue with over-production in the U.S. as they can process pork more cheaply in the US thanin Canada and the grocery chains in Canada buy for the U.S.

“It is dishearten to get 72 cents a kilo and see butterfly chops at $12 /kilo in the grocery stores,” said Farrell.

“The Quebec packers came to meeting the Quinte Northumberland Hog Growers Association,” said Farrell. “We used to sign a year contract to deliver pigs to Quebec now we can’t even renew it monthly. They met a lot of us a year ago and now we are still shipping week to week but we could get a phone call at any time to say the plant is closing.

If Quebec can’t take their animals they would go to Pennsylvania or Brandon, Manitoba.

"People are trying to come up with crazy ways to solve this, but what is needed is a packing plant in Ontario," said Farrell.

The number of pork producers in Ontario in Ontario has declined. In 1980 there were 36,000 producers now there are only 3,000. Hay Bay farms (Mark and Eric Davies) are the largest producers in this area.

There is a Napanee hog farmers who doesn’t ship through the board. Their pork is sold at the local abattoir and in the Kingston Farmers’ Market. Oliver Ham scaled back production and cut out the middle man

Farrell sees a dichotomy between the consumer and the citizen. The citizen wants to do the right thing and support the local community and the person who grew their food. However, once the citizen enters the supermarket they want cheap food and don’t care where it comes from.

"We have double standards, said Farrell. We want agriculture to be accountable. We want regulations about manure, pesticides, how the pigs are feed and how they are processed. This is right.

"We used to have a better product than the US when their pigs were fatter with less muscle, but now they have the same genetics as ours.

He does not see a way out as the World Trade Organization says having a supply management system like the Canadian dairy industry with quotas would be an unfair subsidy.

"It is the perfect storm," said Farrell. "If you read AgAlert John DePutter says it is a good time to get into hogs for young farmers."

Farrell said, “If I would figure out how to get out I would as the short-term cycles are getting closer together. We have a worn-out barn and an old tractor that are not worth anything. We put up coverall temporary buildings, but we have to clean them out as there is straw bedding and we are not able to capture the pigs."

The Farrells try to be as self sufficient as possible.

:We grow basically all our feed except soya meal," said Farrell. "Our two main crops are corn and soya beans."

They feed corn either with high moisture content or dry and feed pellets to the piglets for the first week The soya beans need to be roasted to de-activate enzymes which stop them from being digested. This is expensive as Dexter Harder at Northumberland Grain Inc. charges more to roast the soya beans than it does for the Farrells' to grow them.

They are not big enough to set up a system of generating their own energy from biomass. Nearby Donnan Farms are almost at a size where they can take the leap, said Farrrell. They milk nearly 300 cows.

Kevin Farrell is in a predicament as both his father and his uncle want to slow down but he can’t buy them out.

“Even if we closed down,” said Farrell, “it would be nine months before the last hog would be out of the barn. The barn is worth nothing only the value of the land.

His brother works fa large hog producers and is paid a salary and has weekends off.

"The Dutch are interested in coming in and purchasing dairy farms in Ontario as they have a guaranteed income, but not hog farms," said Farrell.

He also pointed out machinery doesn’t last in Centre Hastings. “Dad has been picking stones for 45 years,” said Farrell. “In Brazil there is 90 feet of top soil. In Poland I have never seen land that is as rich and fertile. It is black soil. They use traditional farming methods. The roads were horrible and one can’t get big trucks there."

He sees great farming potential in Poland and Hungary.

“In Canada we should produce our own food,” said Farrell. "We are sick and tired of government hand outs. Farmers should be able to run a business. If you run a business properly you should be able to have a sustainable and successful farm.

"Dad has seen cycles come and go, that is the nature of the business. We have never been in it for the short term. We want make a decent living, raise kids and hopefully retire."

The dairy industry doesn’t seem to be hurting and dairy farmers seem to be excited about new machinery. "They are keen and eager," said Farrell.

“If I had a kid I wouldn’t be telling them to farm," said Farrell. “It is a noble profession. I enjoy working with my dad. But there isn’t any kind of future. Dad and I bang our heads in order to make a living. Commodity (wheat and corn) prices are high temporary, but it is a bubble and in five years back to low prices.

"They are building a deep-water habours by the target="_Blank"> ethanol plant in Loyalist Township to bring in corn from the U.S.

“We are caught in the middle raising hogs, growing grain and cattle, and custom combining. We try and be diversified and hope to pay the bills," said Farrell. “One can make a dollar on hogs when grain prices are low, but when grain goes up hog prices go down. We can’t win for losing."

“Dad is 67 and he needs a cut so he can retire,” said Farrell. "He has done everything by the book in an attempt to be self-sufficient and sustainable. We grow what we consume and raise what we can handle. We buy on the futures (market) on grain and keep spending down to a minimum, but how far ahead are you. It is not debt issue."

If Kevin Farrell bought his father out he would have no capital to replace equipment and buildings

“Pork is an ideal source of protein and we are highly efficient,” said Farrell. “Sows have 2.2 litters a year and 22 piglets. We have 400 acres of corn, 45 acres of beans, and wheat for straw. It is an extremely efficient system. We only bring in potash fertilizer from Manitoba, and we compost the straw

There is more and more paper work for farmers to do.

With the nutrient management regulations one has to be able to store manure for 360 days on the farm.

“We spread manure in the spring and fall therefore we only need six months storage,” said Farrell. But we had to put in another tank so we could store it for nine months, which we didn’t need. The cost of the tank was enough for a new barn. However, citizens say we need this.

“How can we comply with the new regulations? What we get out of it is we can keep farming."

He pointed out municipalities are putting raw sewage into rivers. There is no sewage facility east of Montreal.

“If there was an exit for us there would be a light," said Farrell. "My dad says people have to eat. We find people are sympathetic when we talk with them.

“A farmer has to have many skills. We had an electrical malfunction this morning. A farmers has to be a plumber, welder, carpenter, vet and a mechanic

The farming community all over Ontario is aging. In Hastigs County the average agae of farmers is 53 year old.

"There is only the odd young person at the producers' meetings," said Farrell.

He spoke of the problems facing farming in eastern Ontario such as the time it takes to get parts as they all come from western Ontario. Vaccine syringes for example take at least two weeks to come.

He also pointed out one can only get dial up Internet access. "How responsible is a municipality, which can’t supply high speed?" asked Farrell. "It is utterly ridiculous as everyone can get cell phone reception.

“We are farming in the armpit of the province. John Deere left. We can’t see equipment before you buy it.

He finds it is hard to be positive and hopes to be able to look back in a year and say it was not a big deal.

"I remember my grandfather saying I am just going to farm until I run out of money," said Farrell.

“Maybe we ask too much out of life now. Keep up with the Jones. We are consumers no body seems satisfied. One used to spend one’s whole life building up to car, and house."