Surprise! The Canadian Pork Council wants more money

The federal government has just announced an extra $1 billion in loans to livestock farmers with zero interest on the first $100 000 for each producer.

Ottawa announces more aid for livestock industry

[Agriculture Minister Gerry] Ritz says the government is also streaming more money through existing support programs.

He says a producer with 400 head of cattle should get an extra $38,000 in cash and $116,000 in loans.

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It's unclear whether the aid will be enough for farm groups, who have been calling for unsecured loans and new programs.

The Canadian Pork Council says the industry is facing a crisis of epic proportions due to high costs and low prices.

Indeed, grain prices have been rising recently in global markets, which in turn would raise the price of maintaining livestock. Also, according to Statistic Canada, the price of hogs is only at 77.9% of 1997 levels. The price of poulty, however, has risen by more than 11% over the last year.

Low hog prices must be indicative of either a bloated supply or of relatively weak demand. What is there to be gained by encouraging producers to produce yet more pork? Surely that would only lead to a further deflation of hog prices. And why is the government so eager and willing pad excess pork onto the federal budget?