“When the board began discussing the future of our relationship with the Canadian Cattle Association, it quickly became clear that this was a decision that required broader input,” said Doug Roxburgh, ABP chair.

The board initiated a consultation process with its delegate body. There were several opportunities for discussion, most notably a virtual delegate meeting on Aug. 11.

“Following these conversations, the delegates voted strongly in support of withdrawal. With that clear mandate, the board proceed to vote and voted on the decision,” said Roxburgh, who raises cattle near Bentley, Alta.

He said the move was rooted in governance, transparency and accountability, adding the decision was not made lightly.

“These are values we believe must be reflected in any organization representing Alberta beef producers. We sent a list of the key factors that led to the outcome to the CCA. It is important to us that the CCA be the first to know the reasoning,” he said.

Roxburgh said ABP has significant concern regarding the fiscal transparency at the CCA and recommended the CCA form a dedicated governance committee.

“We also suggested engaging an independent third-party to conduct a comprehensive review of CCA’s governance structure, with input from elected representatives,” he said.

Provincial funding assessments need to be based on retained marketings across all provinces, to ensure fairness and consistency.

“We also urge the unfreezing of board seats and a revision of the representation formula,” said Roxburgh.

“None of our suggestions are new to the CCA. Despite our efforts in asking for change, we have not seen meaningful progression or willingness to address these concerns,” he said.

CCA does not have a finance chair, said Roxburgh.

“We certainly understand there’s a potential for reduced marketings across Canada as the cow herd across Canada decreases, and so at ABP, we’ve worked hard to start to put a plan in place as to what our fiscal projection looks like with the potential of reduced marketings,” he said.

ABP has not been able to get a clear answer on what CCA plans to do in the event of reduced marketings.

Tyler Fulton, president of the CCA, said ABP’s decision was both a shock and not a shock.

“It was a shock to get such a stark announcement,” said Fulton, who raises cattle and has a small cropping entreprise near Birtle, Man.

“We didn’t see that coming.”

However, CCA said they had been working on the matter with ABP.

Roxburgh said ABP’s concern with CCA began about five years ago. An interim agreement between CCA and ABP started three years ago.

“In fact, it was a primary agenda for our September meeting, where we focussed on addressing the funding issue, and Alberta had referenced the likelihood that they’d like to revisit their representation on the CCA,” he said.

Fulton said the issues raised by ABP are not surprise issues.

“They made it very clear we had to address it, and so we were down that pathway, but didn’t really expect the negotiating tactic that they announced,” he said.

Fulton said having a smaller herd in Canada will likely affect CCA.

“The last three years, we’ve been on what I call an interim agreement that Alberta’s contributions to CCA were dependent on their service that they were able to retain that didn’t get refunded. The three-year agreement ends in June of 2026, and reflected a temporary measure, with the understanding that we would work towards a longer-term solution,” he said.

CCA is supported financially by all the provinces, but Alberta contributes the most because it has the largest cattle population. The funding from Alberta represents half of CCA’s financial resources on an annual basis, and so ABP’s departure would have a significant effect on CCA’s operations, and cause disruption.

“It’s a complicated scenario when one of the provincial members is looking for changes, because it’s not CCA’s authority to go and unilaterally change something. It has to work with all its members,” he said.

Fulton said he has heard ABP wants CCA to have more fiscal transparency.

“I think that’s a valid criticism,” he said. “CCA has a really complicated organizational structure, not just with the relationship between the provincial associations and CCA, but also divisions within CCA.”

The divisions include the Beef Cattle Research Council and CANFAX.

Fulton added that there are 80-page financial statements available at all directors’ meetings and the semi-annual meetings. Audited financial statements are available to cattle producers across the country.

Brad Dubeau, general manager of ABP, said ABP has made significant changes to strengthen its organization.

“We’ve streamlined our operations, enhanced our communications, and focused on strengthening the producer driven commission,” he said.

Dubeau said the changes better serve Albertan cattle producers.

“We are committed to continuous improvement and progress at ABP, and we hope to see the same commitment reflected in the organizations that we support,” he said.

ABP has a short-term plan in place to ensure Alberta’s voice continues to be heard provincially, nationally and internationally.

“We’re committed to keeping producers engaged and informed throughout the transition,” he said.

ABP’s financial obligations to CCA will continue until June 30, 2026.

“We are fully committed at ABP to honour that agreement,” said Roxburgh.

ABP’s decision to leave CCA won’t affect funding to the Canadian Beef Check-off Agency or its service providers, including the Beef Cattle Research Council, Public and Stakeholder Engagement and Canada Beef.

Roxburgh said ABP will continue to talk to CCA in the next few months.

“Our hope is for a strong national organization that ABP is part of, that’s truthfully what we want to see,” he said.

“It’s my desire and it’s been communicated to me that there’s a desire from Alberta Beef Producers’ executive to really work through these issues, have them return as a full member, in whatever new arrangement can be negotiated,” said Fulton.

He said his desire is to work through this rift.

“We have a long history despite this. We have a long history of collaborating and cooperating on so many different files, whether it be business risk management, or international advocacy work,” he said.

Fulton said CCA would be reaching out to other provincial cattle associations.

“It’s a complicated process because everyone is going to have their own perspective on it, and quite simply, CCA is driven by all of those different interests,” he said.

“We’ll work through it. I’m optimistic that we’re going to be able to come out further ahead and really address the concerns ABP has put forward. I spoke to Doug Roxburgh yesterday in person. I’m confident that we’ll be able to resolve this, especially after speaking with him.”

The post ABP opens up about leaving CCA appeared first on Alberta Farmer Express.

Charles Gracey was born to Edith (née Down) and Garfield Gracey in 1935 and grew up in Curries, Ont. His interest in the livestock industry was sparked in 1947, when his father’s small dairy herd was depopulated during the national bovine TB eradication program.

Gracey graduated from Guelph’s agricultural sciences program in 1959 and started his career at the Kemptville Agricultural School. Later, as the secretary-manager of the Ontario Beef Improvement Association, he pushed for beef cattle performance testing and a cattle marketing check-off. Similar check-offs were adopted by other provinces, which led to funding for a national beef producers’ association.

In 1970, Gracey joined the Canadian Cattlemen’s Association (CCA), as it was then known. Serving as the association’s executive vice president, he advocated for Canfax, which provided information on cattle prices and future market outlooks. Gracey worked closely with Canfax’s founder, Chris Miller, and developed analytical programs still used within the agency. During his time at the CCA, he also focused on animal health issues, including the eradication of brucellosis in the Canadian herd.

Gracey also helped develop standard dressing procedures at packing plants and spent much of his career creating and refining carcass grading systems. He also helped establish the Canadian Beef Grading Industry, the Beef Information Centre as well as a national cattle identification program for cattle, leading to the creation of the Canadian Cattle Identification Agency.

Global trade was another primary concern for Gracey. Upon joining the Canadian International Trade Tribunal, he adjudicated everything from international trade disputes to complaints around government procurement.

Getting good information into the hands of beef farmers and ranchers was always near the top of Gracey’s list. In 1978, he created BeefWatch, a market report produced by Canfax and published in Canadian Cattlemen magazine twice yearly to this day. He helped establish the Beef Information Centre to link the beef industry to the public. He contributed to several farm magazines throughout his career and into retirement, publishing with Canadian Cattlemen as recently as 2022. Asked about invoicing for his work, he responded that he was “careless about being paid” for his “scribblings” and was motivated primarily by his concern for the industry.

In retirement, Gracey still devoted much of his “leisure time” to industry issues, and believed in freely sharing his analysis with the public. On his personal website, Gracey wrote that carcass grade information “should flow freely to producers so that they can use grade information for its intended purpose of improving the product.” A “lack of individual animal ID” once obstructed that flow, he added, but that obstacle was removed years ago. His website includes grading information, articles and analyses, plus a downloadable spreadsheet that demonstrates the cattle cycle’s effects on the national cow herd.

Gracey’s dedication to the industry and thoughtful, frank analysis of the issues inspired the Canadian Cattlemen’s Association to nominate him for the Canadian Agricultural Hall of Fame, and he was inducted in 2001.

Gracey was survived by his wife, Donna (née Luce); his sister, Evelyn O’Leary (Bev); brothers, David (Coline) and Donald (Nancy); his children, Laurel, Patrick (Barbara), Darren (Anna), and Matthew (Jennifer); and grandchildren, Peter, Noah, Catherine (Aaron), Madison, Fiona, and Alec. His family will hold a celebration of life this summer.

The closing lines of his obituary were fitting to those who knew him.

“Though his heart failed him, it never failed us. In lieu of flowers, support your local butcher.”

The post Beef industry bids farewell to Charlie Gracey appeared first on Alberta Farmer Express.

The goal is to allow producers to compare metrics with farms in their region that share the same management practices.

“Are you competitive and comparable with others of a similar production system?” Canfax executive director Brenna Grant asked during a September webinar.

“We have so much variety in the cow-calf sector that sometimes those provincial averages don’t really make a lot of sense. It can be helpful to look at production systems similar to your own and say, ‘are their numbers, in terms of a benchmark, similar or different and is there something that is actually possible for me to strive towards?’”

The network now draws on 46 farms, most of them in Western Canada. Of the 29 benchmark farms in the West, 11 are from Alberta, with herds ranging in size from 60 to 280 head.

The network lacks large herds, Grant acknowledged, noting that more participation from producers running at least 400 cattle would be ideal. Only three farms in the network match that criteria; one in B.C. and two in Saskatchewan.

Year-round grazing systems are another gap, Grant said.

The network also seeks more regenerative systems, purebred herds and grass-finished operations.

During last year’s drought, a feed shortfall assessment was included for all participating farms, Grant said. Feed costs jumped an average of 27 per cent last year for the benchmark farms (and as high as 47 per cent more in the West), and only 12 per cent of network farms were able to cover short-, medium- and long-term costs last year. (Short-term costs are immediate cash costs, medium-term refers to both cash costs and depreciation, and long-term costs include opportunity costs, market value on investments and the farmer’s own land and labour).

In 2020, 32 per cent of surveyed farms met all costs.

Manitoba and Alberta may have better weathered the financial storm, said Grant.

“On average, for farms in Alberta and Manitoba, they were still able to cover their medium-term costs.”

In B.C., Saskatchewan, Ontario and the Maritimes, benchmark farms were only able to cover short-term costs last year.

Part of the reason could be herd size, Grant said. Across the network, about 89 per cent of farms running 200 to 300 head and 75 per cent of farms with more than 300 head have been profitable in years where data was collected. Below those numbers, profitability fell to 50 per cent or below.

However, some operations with fewer than 100 head are “cost competitive with operations that are over 200 or over 300 head,” Grant said. “It is definitely possible and we do have benchmark farms that are able to do that… While there are definitely economies of scale, there are other factors that do impact this.”

One appears to be cow size. Farms in the highest profit bracket had larger herds (an average of 308 head) but also produced lighter cows (an average 1,330 pounds) compared to those in the lowest-profit bracket (127 head with mature cow weights of 1,376 lb).

Another insight puts less emphasis on the type of feed.

Any feed can be high or low cost, Grant said, as shown in network data. Information from 2020 and 2021 suggested that, while silage-hay mixes seemed more consistently profitable, feeds such as plain hay, plain silage or annuals had a more even split between profitability and loss in the medium term.

“If you are aiming to be a low-cost producer, you really need to aim for less than $800 (per cow) on the cash cost side, and less than $1,200 on the total cost side,” she said.

Network-wide, average cash costs per cow were $924 for cash costs, with $1,518 for total costs.

Producers have until November to sign up to participate in the final data set of the network. They will only have to produce data for the initial collection, and then will have five years before the network returns to update the farm’s information.

More information on the network can be found at the council’s website.

– This article was originally published at the Manitoba Co-operator.

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“When the drought hit last summer, one of the questions that came up was what if guys had to cull really hard,” said Brenna Grant, executive director of Canfax.

“Every operation has been impacted differently by this drought. Some were able to purchase feed and bring it in. For others, there may have been other constraints aside from feed availability, like cash flow.

“So we wanted to know what herd recovery would look like if you were to rebuild from within the herd versus purchasing replacements.”

Canfax researchers looked at how long it would take 17 benchmark farms in their Canadian Cow-Calf Cost of Production Network to rebuild in the 10 years after the drought if they either maintained their herd size in last year; culled but retained their heifers in the following years; or culled in 2021 and purchased bred heifers to rebuild the herd to its original size.

They also evaluated three different culling rates — 25 per cent, 50 per cent, and 75 per cent — on these farms (all located between B.C. and northwest Ontario).

While it’s tough to pinpoint how many cattle producers across Canada would have culled at those different rates during the drought, the national statistics show that cow marketings in 2021 were up 6.5 per cent, to just under 2019 levels, and culling rates were also in line with 2018 and 2019 levels.

“So we were in liquidation, but it’s one where we were really surprised that we were only down one per cent in beef cow inventories on Jan. 1, according to Statistics Canada,” said Grant.

“We’ve heard of areas that have stockpiled feed last year, and that might have been one of the reasons why we didn’t see liquidation as hard as we expected.

“Some of those areas that were able to stockpile feed were able to purchase those cows and keep them within the breeding herd.”

But the full impact of the drought may not have been realized yet.

“Cow slaughter is up seven per cent year to date from last year, remembering that we weren’t in a liquidation rate of cow slaughter in the first quarter of last year because the drought wasn’t quite evident yet. So I think the drought impact is not done yet.”

And those impacts will be felt even harder by producers forced to cull at higher rates because of a lack of feed availability or other cash flow concerns.

“Everything is so driven by economies of scale, and one of the things that happens when you cull really hard is your per-cow costs are impacted because you still have all of your overhead costs but you don’t have as many cows to spread them over,” said Grant.

“Either choice you make, the objective is to minimize the equity drain on the operation. Yes, you want to rebuild as quickly as possible once you have your grass back and it’s suitable to restock, but there are cash flow considerations and other concerns producers are going to be looking at.”

Strategic rebuild

“In previous droughts, you have a big increase in bred heifer prices when everyone who has liquidated is now looking to rebuild. That creates strong demand for bred heifers, and then prices go up,” said Grant.

“If you’re purchasing replacements, the rebuild happens faster — which is a pro — but when you look back to the 1985 drought, basically three years later, bred heifer prices had increased by 36 per cent between the drought year and the peak.”

Ultimately, though, the researchers found that at both the 25 and 50 per cent culling rates, rebuilding with your own heifers would be more profitable for the majority of farms.

“I think there are a lot of producers who would choose this option anyway just due to cash flow considerations,” said Grant. “Even if you’re rebuilding from your own herd, you have the opportunity cost of not selling that heifer calf, but usually, as long as you have reasonable development costs for those bred heifers, that is a better option for most.”

But once you’re over a 50 per cent cull rate, “it simply takes too long to rebuild from within because you don’t have the sheer number of heifer calves you need to rebuild with,” she added.

“Now you’re talking about potentially eight to 10 — or more — years to rebuild to your ideal herd size, and you still have all of your overhead costs during that 10-year period.”

Additionally, if feed is available and cash flow isn’t a concern, purchasing feed — even at higher prices — was more profitable long term because it allows for the economies of scale to be maintained.

It’s important to talk things over with your lender, she added.

“Do you want to get a loan now for feed and maintain your herd size, or do you want to get a loan later for purchasing bred heifers? So it’s important to have that conversation and talk about cash flow challenges and the risks associated with those two choices.”

Of course, this all assumes that there will be a period of recovery following the drought, as happened during the drought of 1985 and 1986.

“For a multi-year drought, that might not be the case, and then it will just push that rebuild out another year,” she said. “When the driving consideration is how to maintain equity in your operation, that really puts a strain on producers if they had liquidated last year and they’re unable to rebuild in a timely fashion.

“That means they’d have to go another year without that income, but they still have those overhead costs to cover. So they may not be considering rebuilding until next year or even further out potentially, depending on how quickly grass comes back.”

But hopefully this study will have cattle producers thinking ahead so that they can strategize their herd rebuild and capitalize on any opportunities that come up.

“We knew that it wasn’t necessarily going to be helpful for producers this year,” said Grant. “But it’s important for them to be thinking about how to protect farm equity so that they can be set for the future when it comes time to rebuild and they do have grass.”

The Canfax study can be found online.

The post Be strategic when rebuilding your cattle herd following drought appeared first on Alberta Farmer Express.

“The purpose of the network is to produce benchmarks for different production systems found across Canada,” a newly released Canfax video states. “This is about seeing possibilities — what is possible for a cow-calf operation to achieve.

“Not the average, but the range of possibilities under different production systems and even within a similar production system.”

That means, for example, a producer in Alberta might find the closest match to his or her system in a “benchmark farm” in Saskatchewan or Manitoba.

The 2020 results come from 115 cattle producers from across the country, who were grouped into 28 of these benchmark farms — including six in Alberta (with data from 23 farms), six in Saskatchewan and two in Manitoba.

Canfax collected a lot of data (with the numbers averaged to ensure anonymity) in a lot of categories going back five years.

Environmental data included things such as annual precipitation in the “eco-region” the farms are located in, the stocking rate and hay yield. Performance indicators covered items such as weaning weights, cow-bull ratio, culling rates and death loss. The description of the production includes info such as days of swath grazing, days on winter feed, sale weights, and dates for the start of calving, weaning and sale.

The reports (there’s one for each benchmark farm) has a detailed breakdown of overall operational costs along with revenue and profitability.

The idea is that by examining this data, a producer can find ways to incrementally cut costs, boost production, and find ways to increase revenue.

“Each production system will have its own set of opportunities, limitations, and areas where greater focus may be beneficial,” says the Beef Cattle Research Council, which is funding the initiative.

Widening the net

Not all productions systems are yet covered in the network but the initial report is “a starting point” for producers, the executive summary of the report states.

“At this point, it should be remembered that the sample is too small to create provincial averages,” the Canfax video states. “That is why we are looking for more producers to sign up.”

A sign-up is currently underway and will close in November. In addition to providing data (Alberta producers must agree to release their AgriProfit$ data), participating producers will be placed in focus groups and meet (virtually) from January to March in sessions run by provincial co-ordinators (there are eight nationally, including two in Alberta).

Part of that process involves looking at what “incremental improvements could be made around productivity, input costs and output prices.”

Producers who participate also receive a $500 honorarium. (Dairy beef producers can also participate.)

For more on the program, go to www.canfax.ca and click on the Resources tab to find links to a description of the network and results from 2020.

There is also a link titled ‘Analysis’ and that links to four documents offering info and insights for cow-calf producers. Each covers a specific topic:

• The executive summary of the 2020 results;
• How to calculate cow depreciation and how to reduce this “considerable cost”;
• Different ways to calculate cost of production (including the method used by the Cost of Production Network);
• And finally, nearly six pages of recommendations for young producers from the 155 participating farmers in the study.

“Recommendations included working with their environment instead of fighting against it, invest in quality cattle such as bulls or artificial insemination technologies, and ensuring cattle have the correct nutrition and infrastructure,” that report states.

The post Finding treasure by taking a deep dive into cow-calf production data appeared first on Alberta Farmer Express.

“We have record-high wholesale beef prices right now,” CANFAX manager and senior analyst Brian Perillat said at the recent (and virtual) Canadian Beef Industry Conference.

Unfortunately, cattle prices are just not responding.

“That’s been frustrating for a lot of producers and the industry,” he said. “But tides will change. The typical cattle cycle is: We overproduce, plug the system in terms of bottleneck at processing, and then we shrink. This will rebalance over time as the market readjusts.”

For most of the year, the beef cut-out price relative to pork was cheaper than it has been for quite a few years (largely because pork prices have risen, too).

“Overall, red meat prices have been extremely strong,” said Perillat.

And strong demand looks set to continue. The impact of African swine fever, which decimated China’s pig herd, still lingers as the nation attempts to build it domestic supply. As well, drought hit Australian production hard (dropping it from the world’s No. 2 exporter to the No. 5 spot).

Those and other factors mean there were declining global meat supplies in 2019 and 2020, which hasn’t been seen before, said Perillat.

“We’re seeing some shifts around globally. All of that is supporting the beef market and supporting our wholesale meat prices.”

One of the biggest drivers is declining cattle numbers in the U.S., where the herd peaked in 2019.

“As we head into 2022, this will be the third consecutive year that we will see smaller cow numbers and smaller cattle numbers in the United States,” said Perillat. “We’ll have about a million less breeding stock at the middle of the year, and about half a million fewer cattle outside of feedlots in the United States.”

American cattle production will be flat this year but “we will start to see the herd decline. Their replacement heifer numbers are down,” he said.

Drought and very high grain prices are major factors, although the need for supply has drawn in some dairy cattle.

“Some of these dairy calves and crossbred calves are coming up in the Canadian industry as well as getting fed and finished and processed in Canada,” he said.

Over the past few years, the United States has shifted between being a net exporter of beef and a net importer.

“They’re back to being a net exporter this year,” said Perillat. “China has stepped up from being a small importer 10 years ago to being the largest beef importer in the world. We continue to see impacts of that.”

Canada has continued to have strong exports, well above 2020 levels, even though last year was a bit of an anomaly because of supply chain issues.

“Even last year, when we saw exports down slightly, we had record-high values. Volume was down last year three to four per cent, but value was fractionally higher.”

Canadian exports are up a billion dollars from 2015 and 2016 (and 10 per cent since 2019) because of strong international demand.

That’s true domestically, too.

“We’ve seen some of the strongest demand levels we’ve seen in the last 30 years,” he said.

“Despite all the rhetoric around cattle, and cattle production, and beef production and markets, consumers continue to spend a lot of their protein dollars on beef.”

However, don’t take those customers for granted, he warned.

“We do see those prices jumping higher and we have to watch how consumers start reacting to these higher prices.”

This year, prices have stayed high but consumption has levelled off.

There was no pullback from higher prices last year, but there were flat consumption levels.

The other big factor to watch is whether the steadily declining Canadian herd sees a big drop in numbers because of the drought. Late-season rains may have stopped as many cows from going to market, and some producers may have found feed, he said.

Aside from the massive decline in the herd in Canada, beef production is strong and healthy, he said.

The industry has the highest slaughter rates in a decade along with larger carcass rates. The feedlot sector has continued to grow, and there are about 15 per cent more feedlots than 2015.

The post Cattle producers struggle but beef suppliers are doing just fine appeared first on Alberta Farmer Express.

“For Canada in the 2018-20 period, the cattle sector had $51.6 billion in goods and sales, contributed $21.8 billion to gross domestic product at market prices, including $11.7 billion in labour income and is directly or indirectly associated with creation of 347,352 full-time equivalent jobs,” the report done for Canfax states.

“For every $1 of income received by workers and farm owners, another $6.22 are created elsewhere.”

For the full report titled ‘The Beef Industry’s Contribution to the Canadian Economy,’ visit cattle.ca. (opens as a PDF)

The post A beefy economic contribution appeared first on Alberta Farmer Express.

“As the industry has been rocked by COVID-19, there is an opportunity for producers to examine what they can control — their cost of production,” said Brenna Grant, manager of Canfax Research Services.

“During the boom years when prices are high, it’s easy for costs to get out of hand. But regular evaluation of what’s happening with those numbers can tell you where creep may be occurring.

“Knowing where this creep is occurring can help bring attention to managing it.”

Producers always notice when land prices or rent, wages, and equipment costs go up. But items such as overall input costs and productivity can be trickier to manage without careful monitoring. That’s when the classic line, you can’t manage what you don’t measure, comes into play.

“Good record-keeping helps take the guesswork out of decision-making,” said Ann Boyda, livestock economist with Alberta Agriculture and Forestry.

“A lot of producers do have financial information that gives them a financial picture. But in combination with their production management, they are better able to identify on a per-unit production basis where efficiency gains can occur.

“A lot do it informally or base it off experience, but having the actual data to validate their experience is beneficial for them.”

Record-keeping also allows producers to identify trends over time.

“That way, if they’ve changed a strategy, they can see how it’s impacting their operation,” said Boyda.

But monitoring cost-of-production data is a task that easily slips into ‘I’ll do next week/month/year’ territory.

“Many producers don’t want to track per-unit costs every year, as it takes time and requires both financial and production data,” said Grant. “Given many of the numbers don’t change much from year to year, it’s not considered worthwhile.”

Tools such as AgriProfit$ — an Alberta Agriculture program that tracks production and financial performance — can help, but there is “a complexity” to it that makes it tricky without good records.

“There’s a lot of detailed information required, whether it’s rations, feed amounts, feed quality, the grazing period,” said Boyda. “They have to be tracking their information on a continuous basis, and that’s why we need to emphasize record-keeping.”

Cost-of-production network

Benchmarking can also help with that, by comparing the cost of production of different practices and marketing strategies, she added.

“Estimating and managing production costs requires a great deal of information that varies from farm to farm,” said Boyda.

“By tracking their progress, producers can see how well they are meeting their targets.”

And a new Canadian Cow-Calf Cost of Production Network will be building those benchmarks for cow-calf producers across the country. Led by Canfax, the network will allow producers in every province to do an apples-to-apples comparison of their operations’ performance to that of other producers here in Canada and elsewhere.

“The network provides producers an opportunity to share their experiences and learn from each other,” said Boyda.

Participating producers will be placed into focus groups based on their eco-regions (areas with similar soils and climate) and production practices, and within those 26 groups, producers will share information for data collection and brainstorming, said Grant. Participants will receive a $500 honorarium. Focus groups are expected to start in January.

“Having someone who is able to say, ‘I tried that and it doesn’t work for this production system or environment for these reasons,’ can help save time, energy, and dollars,” said Grant. “It’s really about speeding up the learning process so that producers can focus on things that work.”

That’s ultimately the point of monitoring cost of production — “identifying incremental improvements… that help drive efficiency and financial performance,” said Boyda.

“The bottom line is profitability and sustainability,” she added. “The ability to measure and manage costs is central to successful operations. If they’re looking to be in the business in the future, they need to keep an eye on this type of information.”

For more information on the Canadian Cow-Calf Cost of Production Network or to sign up, visit canfax.ca.

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The shutdown of Cargill in High River and the slowdown of JBS in Brooks left a backlog of cattle that many worried would pummel calf prices this fall.

“Our processing was limited in the spring,” said Brian Perillat, senior manager with CANFAX during the Canadian Cattlemen’s virtual town hall in late September.

“Through summer, we’ve recovered and processing levels are back to pre-COVID levels,” he said.

The plants have also been working through the backlog by adding Saturday shifts so they can slaughter six days a week.

At one point, the number of market-ready cattle that had to be held back at feedlots and farms hit around 130,000 cattle. But slaughter plants have since made impressive gains in reducing that number.

“Through the summer, we processed over 32,000 more than we did a year ago,” Perillat said during the Sept. 23 town hall. “We just got last week’s slaughter numbers. We processed about 7,500 more fed cattle (during the week) than we did last year.”

However, that still leaves a backlog of about 80,000 to 90,000 cattle left to work through.

“The cow market is hanging in there,” said Perillat. “It doesn’t have the premium it has compared to the U.S., so we’ll maybe see a few cows shuffle south.”

Carcass weights in Canada have gone up and are higher than a year ago.

“It’s something we’ve got to monitor as we still have some cattle to work through the rest of the third quarter and into the start of the fourth quarter,” he said.

Despite slaughter volumes increasing, Alberta fed cattle prices have struggled and have been well below year-ago levels all summer.

“That continues to be a weakness due to large cattle supplies on the market,” he said.

Despite the lower prices that feedlots are receiving for slaughter-ready cattle, feeder cattle prices have been strong through the summer, said Perillat.

The federal and provincial governments created a $43-million ‘set-aside’ program in Alberta to cover the costs of feeding cattle waiting to be processed. That program covered some of the losses during the spring, but feedlot losses have been significant.

However, the huge volatility in the fed cattle market has levelled off and calf prices are higher than they were a year ago and the futures markets have been projecting some stronger prices into new year.

“That’s something we’ve got to watch heading into the fall run,” said Perillat. “Just how long as these fed cattle prices going to be depressed and how much are they going to bid in, gamble and speculate on the market?”

The fall run has had a slow start. Sales of yearlings have ramped up, but sales of calves have been slower, he said.

Since there were no production shutdowns in Ontario, that market has not been significantly impacted, with Ontario prices at a slight premium compared to the Alberta market.

It is hoped that packers can continue working through the backlog quickly in this quarter. Spring placements were lower than a year ago.

“That should free up some space so we can work through this backlog,”said Perillat. “We can see some light at the end of the tunnel for the cattle on feed numbers, but we also have to remember, we placed a lot fewer this spring, and more cattle went on grass.

“We could see a lot more placements staying around, with a lot of feed around. Some cattle could background rather than going straight to finishing.”

There are a few other factors to watch.

The Canadian dollar, which fell below US70 cents in early spring, has been showing strength against the American greenback. As well barley prices are spiking back up and American corn prices are also rising. Both the dollar and the feed prices could affect calf prices.

And while the food service sector is suffering as the pandemic pummels restaurants, retail sales of beef are holding up quite well.

“Cut-outs are still hanging in there. Packing plants are making good profits and have a lot of incentive to kill more cattle,” said Perillat.

As well, feeder placements were lower in both the U.S. and Canada in spring, but more feeders were placed through the rest of the year in North America, he said.

“It’s not an imminent number, but we are going to have larger supplies in the fourth quarter,” he said.

The pandemic remains the wild card and the threat of packing plant shutdowns and supply chain issues has not gone away, Canadian Cattlemen’s Association president Bob Lowe said in his remarks to the town hall.

But everyone in the sector has to do their part, said Lowe, a rancher and feedlot operator from Nanton.

“As beef producers, we need to do our part to make sure we do not get more of an economic meltdown,” he said. “I would encourage everybody to remain vigilant about face masks and social distancing.

“The country can’t stand any more of an economic shutdown, so we need to do our part to make sure that doesn’t happen.”

The post ‘Light at the end of the tunnel’ as cattle backlog numbers fall appeared first on Alberta Farmer Express.

The Canadian Cow-Calf Cost of Production Network (CDN COP Network) has been developed collaboratively with provincial co-ordinators and funded by the Beef Cattle Research Council with the goal of helping cow-calf producers evaluate new technologies and enhance their competitiveness in an international marketplace.

This article looks at the four reasons for creating the CDN COP Network.

Regional benchmarks

Producers use cost-of-production data to benchmark and evaluate their own farm’s performance over time, but also to benchmark against a provincial average to determine competitiveness and resilience.

However, provincial averages mean, for example, that data from an operation in one region of a province with less than 100 days of winter feeding and an operation located in an area with over 150 days of winter feeding are aggregated together into a single benchmark.

These ‘benchmarks’ do not make sense to producers and discourage participation in these programs.

Grouping farms together based upon production practices rather than using provincial boundaries will allow producers to self-select benchmark farms that they can identify with through a set of management practices that best fit their operation’s situation.

National coverage

There has been limited cost-of-production data available to cow-calf producers outside of Alberta for several years. Historically each province has had its own system for collecting and calculating cost of production. Differences in methodology has meant results could not be compared, or if they were, it was done with caveats that methodology differed.

Over the last 20 years, investment by provinces has declined from annual on-farm collection to surveys every five years, or no collection at all in some areas.

With the CDN COP Network, there will be cost-of-production benchmarking data from coast to coast for the first time. All will utilize a standardized methodology that allows for international comparisons in agri benchmark, an international cost-of-production network with coverage in 34 countries representing 80 per cent of global beef production.

Improved efficiency

Producer data will be collected every five years with prices indexed annually.

This means that historical data will be available right away for analysis and research projects.

Data collection through the CDN COP Network provides the basis for the different types of production systems in each region, while provincial averages will be used for the appropriate sale weeks and weights for each animal type annually.

In addition, duplication will be minimized as this cost-of-production information is used in research projects, reducing the need for additional data collection from producers. Specifically, the CDN COP Network data will provide the basis for the Canadian Roundtable for Sustainable Beef’s updated economic assessment in 2021-23. This project will connect cow-calf economics with practices that reduce greenhouse gas emissions on farm to find win-win solutions.

Learning in community

Producers will be able to learn from each other and share ideas on how to implement different practices once they complete their participation in a focus group.

The goal of the network is not just to provide benchmarks, but also to encourage innovation and pass on knowledge to a new generation of producers entering the industry and learn from other producers.

This is an opportunity to be a part of a producer network committed to learning about the benefits and costs of adopting different practices and improving together. Scenarios will be developed for what future farms could look like utilizing the Five Per Cent Rule to identify where incremental improvements could be made around productivity, input costs, and output prices.

To participate, go to canfax.ca/COPNetwork.aspx and fill out the Producer Sign-up Survey.

The post New benchmarking program aims to help you up your game appeared first on Alberta Farmer Express.