The pandemic’s effect on the bison industry has been “absolutely staggering” over the past two months.
“Our slaughter numbers in federal plants are down 81 per cent over this time last year,” said Steven Lunty, chair of Bison Producers of Alberta. “That means if we processed 100 animals in April of 2019, we processed 19 in April of 2020. That’s a significant hit for any industry.”
And that number likely fell further last month.
“The food-service industry has essentially shut down,” said Lunty, who ranches near Bentley. “Several of the marketing companies focus on food service, and with few to no restaurants open for food service, there are no orders coming in.
“Trying to turn a marketing company on its heels and redirecting to retail takes time. It’s like trying to push water uphill. It doesn’t happen overnight.”
As a result, hot hanging prices have dropped by about 25 per cent.
“Our historic high was about three years ago, at $6.40, and now we’re in the neighbourhood of $4,” he said. “We thought we had a good stable market, but the pandemic happened and the bottom has fallen out.”
One saving grace is that the U.S. border remains open.
“We ship pretty close to 70 per cent of our finished animals down to the States,” said Lunty. “Had the borders closed, the industry would have had a catastrophic failure.”
Retooling and readjusting
The U.S. has been able to maintain steady retail demand for bison meat, and Canadian producers have been able to take advantage of that.
“Many producers market their animals to the U.S., and with the exchange rates, they have received and continue to receive a reasonable return on their animals,” said Terry Kremeniuk, executive director of the Canadian Bison Association.
“But the folks who sell into the Canadian marketplace are faced with some readjustment. The number of animals being slaughtered is down in the short run, so they’re retooling to readjust.”
Those selling direct to consumers are “having a bumper year,” said Lunty, but only about 10 per cent of bison meat is sold that way.
“They’ve never done so well, that’s excellent for them,” he said. “But a big chunk of the industry is real nervous right now because they have animals that are finished, or close to finished, and they don’t have a home for them. It’s a scary time.”
Only three federal plants in Canada process bison, and one has switched entirely over to beef for the duration. On top of that, marketers of bison meat have largely reduced — or outright cancelled — their slaughters, and as they give up their slaughter space, custom plants are filling those slots with beef.
Ultimately, there’s nowhere for these bison to go.
“There’s no way the States can take on the additional volume of animals. They’re booked up for the next several months,” said Lunty. “There’s no way the farm-gaters can take on that kind of volume — it’s a physical impossibility. There isn’t necessarily a home for these animals.”
Moreover, with a glut on animals for sale, buyers are docking prices for animals that are too large or overfat.
“Now your animal has cost you extra money (to feed) and your marketer can potentially dock you. You’re losing money on both sides,” he said.
“We need these economies to open back up again so we can start shipping back to food service.”
The European Union is still accepting bison shipments, but quotes for air freight have quintupled, going from $3 a kilogram to $15 a kilogram.
“With the closure of the restaurants there and the reduction in the number of flights, it added to the cost of doing business for what little business there was to do,” said Kremeniuk.
“There are still marketers who are serving that market at a cost, because they want to be in a position so that when the market does open up, they won’t have to restart the market. They have a foot in the door there and they can just expand it.”
The bison sector has asked governments about offsetting higher freight costs.
“If we were able to get some sort of a subsidy from either the provincial or federal government, there is still a market over there, but they’re not willing to pay the freight and neither are the marketing companies,” said Lunty.
“That’s one thing we’ve asked for and been denied.”
Lunty also hoped bison would be included in the set-aside program that was announced for the cattle industry at the start of May, but again, no luck.
“We were excluded from that deal as well.”
Rebuilding the industry
The pandemic is a wake-up call and shows the sector needs to diversify its markets, said Lundy.
“The fear of the border closing is one thing that’s really got people’s attention,” he said. “We’re very reliant on what happens in the States. It’s a critical part of our industry. But if we’re completely reliant on that border being open, that’s putting all of our eggs in one basket.
“If we don’t diversify or come up with other ways to market our finished animals and meat, we’re in trouble.”
Some of that work is already underway. There’s plenty of room for growth in Europe, and Asia is an emerging market that the industry is keeping an eye on, said Kremeniuk.
“Those are longer-term initiatives. We have to get through the short term before the long term is any good to us,” he said, adding he’s “very optimistic about the future of the industry.”
But people within the industry will have to put in the work, Lunty added.
“Some of the marketers have gone strictly to food service because it’s easy. Some of the producers have gone strictly to shipping to the States because it’s easy. But what’s easy might not necessarily be the right thing to do.”
The alternative is unthinkable for Lunty, who produces bison exclusively on his operation.
“This is what puts food on my table,” he said. “We’re all in on this bison industry, and if it fails, we have an awful lot of bison that don’t have a home. That’s terrifying.”
There has been one bright spot.
“It’s a silly little thing, but people I haven’t talked to in years reached out to me to find out where they could get some of our product,” said Lunty.
“That reminded me that people want this and we’re doing the right thing. We’re on the right track — we just need to find more avenues to do that.
“Out of every challenge comes an opportunity. This pandemic is a huge challenge, but I hope the bison industry can turn this challenge into an opportunity.”