A Practical Approach to Hog Barn Construction in Western Canada

Saskatchewan Pork Seminar
Barn construction in Western Canada
Sunterra Overview
• 9 retail outlets
• Hog processing plant processing about 2600
pigs per week
• Cropping – wheat, barley canola. 2600 acres
• Hogs – 13,000 sows F to F.
• Contract hog management.
• We employ about 1200 people.
Sunterra hogs
• 7500 sows in Alberta, 5500 sows in Ontario
• Finish about 70,000 of our own pigs in
Alberta for the pork plant to go to the Japanese
markets
• Finish over 250,000 of our own pigs in South
Dakota and Iowa.
• All pigs contract managed by the Contract
Management team.
Sunterra Contract
Management
• Manage 13,000 sows owned by Sunterra and
Sunwold.
• Currently manage about 750,000 pigs wean to
finish in USA. Will be over 1 million by the
end of the year.
• Oversaw the construction of 90,000 nursery
and finishing space in South Dakota in the past
two years.
• Developing contract management in Ontario.
South Dakota expansion
• In the past 2 years we have worked with
Parkston Mill and Farmers to get:
–
–
–
–
–
71,500 finishing spaces
19,200 nursery spaces
A new 180,000 ton per year feed mill.
An office in Parkston
Hired 6 new staff ourselves, 4 more by the end of
the year
Our experience
• Big resistance to begin with due to image of
Corporate Farms = started slowly.
• As we have proceeded, things have settled
down and we now have many farmers wanting
to put up barns.
• The pace of construction is accelerating.
• Favorable regulatory and banking
requirements in the US Midwest.
Why will people build?
• 41% of pigs finished in contracted space in the
US.
• Between $100 to $115 per acre value in
manure
• Increases corn yields by 5 to 10 bu/acre
• Excellent return when manure value is taken
into account.
• Children coming back to the farm.
Bank requirements - US
• 25% equity.
– Can be in the form of land for the building
– On a $650,000 barn equity required is $162,500
– 5 acres of land @ $7000 = $35,000
• No other equity required
• Loan is secured on the basis of the lease
• Typically require 10-year lease on the facility.
Bank requirements in
Canada
• Limit on the cost of the barn to $900,000 –
lessee has to fund the rest of the cost. (2400)
• 50% equity
• Owner personal guarantees.
• 2nd mortgage on property.
WE NEED TO GET BARNS BUILT!
Space needed in Western
Canada
• Informal survey of largest producers in Western
Canada. (AB,SK,MB)
Producer 1
Producer 2
Producer 3
Producer 4
Producer 5
Producer 6
Producer 7
Producer 8
Space needed
Nurseries Finishers
0
100,000
40,000
90,000
0
73,500
65,000
150,000
250,000
150,000
0
12,000
50,000
0
105,000 875,500
Hogs needed to fill
plants
We need 2 million pigs to fill the
kills at the two major plants in
Western Canada.
• 1 million for Brandon
• 1 million for Red Deer
• Coincides with the # spaces
Types of buildings
• 2 types of finishers
– “Double wide”
– “Double long”
• Both 2 room, 2400 head buildings. Side by
side or end to end
• Both fully slatted.
• Might be better to build “Double Wides” east
of Alberta due to prolonged cold spells.
• Both work fine in the US.
• Both can be used wean to finish.
Double wide
•
•
•
•
•
•
Tunnel ventilated
Side curtains only for emergency
Large capacity, dry feeders
Deep pit – 8 ft (One year’s storage)
Low ceiling
Either office with shower or Danish Entrance
Double wide barn
Double long buildings
•
•
•
•
•
400 ft long by 50 ft wide
Deep pits – 8 ft
Small pens
Dry feeders
Curtain sided with minimum ventilation in
winter.
• Centre office and loadout
• North curtain is insulated
Double long buildings
Barn layout
Small pens:
More options for recovery space and hospital pens – Lower mortality/culls
• Cup drinkers – less water wastage-better manure quality
• Dry feeders – better feed efficiencies and longer shelf life
Standardized equipment specification list- Efficiencies in
training
and multi site are
staffing
Equipment/controllers
now standardized
• Efficiencies in training and multi barn staffing
• Sunterra Barn Specification Sheet in place
Wean to finish
Pros and cons
• Double wides use more energy due to forced
ventilation
• Double longs have a larger footprint
• Double longs have more curtain space –
maybe not so good for Sask & Man winters?
• I think double longs ventilate better and are
easier to manage – KISS for contract
producers!
Cost of construction
• Both types of barns are very similar cost to
build
• US$260 to $300 per pig space in US.
(Cdn$340 to $390) depending on where you
are building in the Midwest.
• Contract run from $36 to $40 per pig space
Canada construction
• We are building a double long in Alberta.
• 4ft pits due to having an existing lagoon =
nearly 2 years of storage.
• Added cost of piping to lagoon
• We put in used slats we bought up from the US
which lowered cost by $40,000.
Changes
• The barn will cost under C$400 per pig space
competitive with US
• Used slats saved $17.00 per pig space.
• Incorporating the lagoon was a net extra cost
of $13.75 per pig space
Issues building in
Western Canada
Weaker Canadian dollar has had
a major impact on our cost of
construction versus the US!
Issues building in
Western Canada
• Banking – need to reduce the requirements on
new buildings.
– Contract and 25% equity should be enough
• Slats – Only one manufacturer = monopoly.
– We need more competition to lower costs.
Issues building in
Western Canada
• Concrete costs are a little higher but coming
down – not restrictive! Shop around!
– Difference between US and Canada of C$14,500
per barn ($5.95 per pig space)
Issues building in
Western Canada
• Labour here is now not cheaper here than in
the US.
– Const. labour in US is US$17/hr (C$22.50)
• Equipment comes from the US – need
manufacturers here
Contact
If you need further information, please contact:
Ben Woolley
[email protected]
403 546 3201
Thank you
Ben Woolley
Vice President of Operations
Sunterra Farms