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Hog transition program funds fully booked up

A federally-funded exit program for cash-strapped hog producers has officially earmarked all available cash as of Jan. 31 and is now being wound down.

The Canadian Pork Council, which administers the federal Hog Farm Transition Program (HFTP), said in a release Friday that the program’s $75 million budget has been allocated to a total of 455 hog producers to help them exit the business.

In all, the council said, it’s expected barn capacity for 126,765 sows, 263,857 weaners and 446,909 market hogs will be taken out of production when all barns are emptied.

Payments to program participants will continue, the council said Friday, as barns are closed and paperwork is finalized.

As per the funding agreement with Agriculture and Agri-Food Canada, HFTP participants have until March 31 this year to depopulate their barns as they declared, the council said Friday.

Random monitoring is to continue until March 31, 2014, three years after the last participating barns are emptied, to ensure compliance.

“Market realities”

The HFTP was launched in 2009 to help Canadian hog producers cull their industry down to a “more sustainable” level of production, as they were faced with low hog prices, high feed costs and a strong Canadian dollar.

The program was set up to provide payments to producers who agreed to set aside production in all barns for a minimum three-year period, so as to “help facilitate an orderly transition to these new market realities.”

The program offered funding through four tenders held between November 2009 and March 2010, as eligible farmers submitted bids on what they’d need to idle an agreed amount of production for 36 months.

After the final tender of March 10, 2010 closed, the program kept allocating funds, as some producers either withdrew by choice or were dropped from the program for not meeting its terms and conditions.

That residual allocation process saw 69 producers share $12.5 million in remaining HFTP funds over 13 rounds. The most recent round was Jan. 13 this year, the council said.

Producers were asked in August to contact the council “as soon as possible” to confirm whether or not they plan to halt production as they’d originally proposed and to accept their payments.

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