The livestock industry across Canada is reeling from months of gloomy news, but despair was in scarce supply at the annual meeting of the Canadian Cattlemen’s Association as delegates took a long-term view of the industry’s prospects.
President Brad Wildeman said in an interview there’s plenty of concern among producers about regaining the equity lost in the economic turmoil, but their situation is better than a year ago. “Then we had the high dollar, high grain prices and low animal prices. Now the dollar and grain prices are down and some profitability is coming back into the business. We’re not bleeding like last year.
“Some positive developments have happened such as the reopening of export markets,” he said. “It’s not like we face an overwhelming supply of meat and U. S. COOL program is better than it was a year ago.”
Many cattlemen have sold down their cow herd to pay the bills and must now rebuild, he says. “And we we’re not alone in facing tough times.”
A forecast presented to the meeting reinforced Wildeman’s outlook.
Richard Brown, a consultant with the European firm GIRA, said a continuing decline in livestock production around the world should lead to more stable cattle and pig prices later this year. The production drop should underpin prices and restore some profitability through a more balanced supply and demand picture. There’s already been a significant drop in pork production globally and the beef production is falling. So price declines (to producers) have not been as severe as they might have been.”
The livestock industry has been through a volatile few years and any herd rebuilding will be done carefully as a result, he says. Farmers also need to realize the global economic crisis will force consumers to be more careful at the grocery store and they will likely forgo premium items for staples.
Brown highlights a number of international trends that cattle producers should be aware of:
China is working towards becoming self sufficient in beef, poultry and pork;
Water shortages will reduce Australia’s beef export potential;
All signs are of a drop in beef shipments from Brazil;
Beef consumption in Japan remains depressed because of that country’s lingering BSE problems;
Europe is no longer overproducing beef and dumping its excess on world markets;
The EU’s ban on hormone-treated beef is widely supported and unlikely to change.
Mark Klassen of the CCA told the delegates the association has presented the federal government with 25 recommendations for boosting meat exports. Agriculture Minister Gerry Ritz is already working on a proposal to create a market access secretariat within Agriculture Canada. “The federal trade negotiators are spread too thin. We need four to six more so we can have real consultations with other countries.”
The Association also wants the Canadian Food Inspection Agency to have an office dedicated to resolving trade issues. “We still face a lot of technical and sanitary and phytosanitary barriers,” Klassen said.