Thank you very much, Larry. I appreciate the opportunity. It was actually a train, not a plane, and it wasn't late. It's just that the schedule was very tight. I do appreciate your putting us at the end of the schedule so I could make the presentation.
You do have PowerPoint slides in front of you. I want to go very quickly through that, particularly the first few pages, just to set the stage a little bit. As I've presented to this committee in the past, you are well aware of some of the shocks our industry has experienced over the last three to five years. For example, there's been the circovirus, the currency fluctuations, the feed costs, the recession, and the U.S. COOL regulations, and then, of course, there is the latest challenge of the H1N1 virus. That has had an absolutely devastating impact on our industry.
If we look back at where the hog industry has gone over the past 20 years, it has actually been a true success story up until the last three. Over the years, we've had increased sow productivity and tremendous export growth, as you've just heard; at one point, we were the largest exporter in the world, and now we're in third or fourth spot. So the export market is still a big part of our industry and probably accounts for some 40,000 jobs in Canada—just the export part alone.
But today the situation is vastly different. We are experiencing the worst economic returns ever in the hog industry. We've also had some market declines. Domestic consumption is at best levels, but is starting to drop a little bit from imports of a lot of cheap U.S. pork being dumped into our market. That's affecting us. In fact, 25% of our consumption right now is U.S. pork being brought cheaply into this country. On top of that, our market of live hogs into the U.S. has been eroded due to the implementation of COOL. So one thing piles on top of the other.
But having said that, our international opportunities have been maintained, as you've just heard from Edouard. Our exports have actually stayed level, whereas the U.S. exports have dropped some 30% year to year. So that does speak well for the product that we produce and how we are recognized around the world.
The next slide shows you where the prices have gone over the past number of years. The blue line there shows you how low we are. These are Ontario prices, but prices are the same across Canada. You heard from Leza that getting $95 or $100 when it costs you $150 or $160 to produce just plainly doesn't cut it.
So we are an industry in transition. We did take a look at where we feel our industry should be. So we put a five-year plan in place and targeted where our industry would be comfortable being—and not losing too many of the jobs so desperately needed in this time of economic recession, when we really don't want to lose a lot more jobs. We have recognized that live hog exports are going to go down; we expect them to go down to about some four million hogs, from the ten million where we were. We expect our exports to stay roughly where they are, at about one million metric tonnes. As for our domestic disappearance, right now only 75% of consumption in Canada is from our own production. We would like that to go back up to about 88% to 90%, or an increase of about 150,000 tonnes in Canadian pork eaten in Canada rather than U.S. pork. This would give us a domestic slaughter of about 21.5 million animals from where we are today, and total production of about 25.5 million hogs.
On the international trade front—and I'll go over this very quickly, because you just had a very good report—the pork trade is going to remain critical for our industry, and certainly government can play a very big role in that to give us that market access. We represent some 20% of the world trade in pork meat, so we're a significant player on that side of the market. So it is absolutely vital to retain export market access, and we certainly have always been pushing for a conclusion to the Doha round of the WTO, but I think most of us have to admit that doesn't look very promising these days.
We do believe that our government needs to concentrate on bilateral agreements, in light of the fact that the WTO is stalled. We have a country like Chile, for example, which is much smaller than we are. They have the most bilateral agreements of any country in the world. Why can't we do that? We need to do that. It is part of the government's responsibility and job to go out there to see to it that we have market access by working with countries such as Chile, which has really helped its access around the world—which we don't have.
A message I do want to leave with you is that we're happy about the deals signed, like the trade agreement with Colombia and the work on a Canada-EU trade agreement—which is critical—and the agreement with Korea has to be pushed ahead and signed, but there are many more. The agreements like the one with Jordan aren't really going to make much of a difference, so we do need to reach ones that have some value to us.
Moving on from that, as you know, we came to the government last spring to talk about how we can transition through this, and in 2008 we got the advance payment program and the cull breeding swine program, which were helpful, but certainly with the continued difficulties, they didn't solve everything. But in 2009 we have the hog industry loan loss reserve program, the hog farm transition program, and the international pork marketing fund. Those are things that we, in a way, asked for, albeit a little bit differently, but those are what the government decided to come out with, together in negotiations with us. And we feel there is some value in each of these programs.
So I want to go very quickly through the key elements of the hog farm transition program.
It is not a buy-out, but a program to assist producers to transition out. It's operating through a tendering process, and so you do a bid process. In fact, we had our first bid session yesterday, which went quite successfully and worked well, and the next one is going to be on the 18th. We feel that it's not an answer to everyone, absolutely, but it is helpful to some producers who plan to transition out.
Then the hog industry loan loss reserve program, unfortunately, has taken three months until we finally now have the banks signing. They still haven't all signed, but I do understand that a number have now signed. The FCC signed on Thursday, and some of the other banks have signed this week, and others will do so today and next week. While that is positive, some of the messaging I'm getting back is a cause for concern, so we do need to stay right on top of that and make sure producers have access to these funds. We may be talking to you again if it isn't working, because it is critical that our producers, in the tight cashflow situations they're in, have the ability to draw these funds to help them out.
In summary, we have a role here. The industry association and the government need to work together and be a little flexible and fluid as we move through in order to make sure these programs work well. Ultimately we accept the fact that the primary responsibility is with our producers. With your assistance, we need to develop a sustainable plan so our industry becomes strong once again into the future.