Arun Thangaraj, federal deputy minister of transport, said the value chain is still feeling pressure.

“The pinch points still exist. It is imperative that we tackle them now.”

A national supply chain office, as recommended by a task force, has been established to help alleviate those pressures, he noted.

The co-chair of that task force, Jean Gattuso, said the office is a positive development, but too many things still aren’t fixed. Supply chains must be competitive, efficient and reliable, he said, and “not being reliable is probably the worst sin.”

Gattuso said Canada requires bullish objectives to ensure reliability. About 80 per cent of the world’s ocean freight is controlled by eight companies, he noted, and those will take their containers to American ports if they can’t count on Canada.

Government could enact regulations to enhance reliability, he added, and the supply chain office is looking at these issues.

Gattuso said the economic slowdown in 2022-23 resulted in better freight rates and more shipping capacity, and that could accelerate the transformation of the supply chain. But investment in critical infrastructure must rise.

“For every dollar managed by the eight largest pension funds in Canada, only 75 cents is invested outside of Canada. Of the 25 cents invested in Canada, two cents is invested in infrastructure,” he said.

That isn’t enough to foster the future a trading nation like Canada wants or needs.

Ron Lemaire, president of the Canadian Produce Marketing Association, argued that farmers pay the most when disruption occurs. He likened the supply chain to an orchestra, in which all the instruments have to be tuned to play together. If one is out of tune, everyone notices.

“I haven’t heard anyone say food is essential. We’re missing that key component in all of our policy and regulation in Canada,” he said.

Gattuso said the entire supply chain is full of bottlenecks and faces issues with capacity, distribution and infrastructure.

Marc Brazeau, chief executive officer of the Railway Association of Canada, noted grain cannot currently be loaded in the rain at the Port of Vancouver. Ports at Seattle and Portland have been able to do this for some time, he said.

“The Port of Vancouver has estimated that solving that problem would unlock about seven per cent in new capacity. That’s significant,” he said.

He added that governments could encourage that type of investment at terminals through something like accelerated depreciation. Maximizing port capacity through 24/7 operation would also help.

“If rail cars do not arrive at a country elevator on time because it’s raining in Vancouver, it’s tough to blame the railways if we don’t have some of those solutions in place,” he said.

Brazeau also said railways want the extended interswitching pilot project to be repealed so rail car movement occurs in Canada.

“Frankly, what we saw in 2014 to 2017 (when extended interswitching was in place) was more traffic moving south,” he said. “That means more jobs headed south because those containers and those goods are headed to ports.”

Gattuso noted that Americans are investing heavily in their ports so “we cannot look at ourselves and say we think we’re OK.”

Lemaire added that the U.S. requires timely data. Canada can’t sit on data and say the environment is competitive.

Panelists said Canada should look to examples in other countries for best practices to improve the supply chain overall.

– Karen Briere is a reporter with the Western Producer.

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In 2021, scientists revealed that 40 per cent of white-tailed deer sampled in Michigan, Pennsylvania, Illinois and New York state in the U.S. had antibodies for the virus.

Surveillance of these deer continues, and a new study by researchers at Ohio State University found that the virus is still spreading among the animals and back to humans, and it is evolving rapidly.

The researchers looked at the prevalence of the virus in a small sample of white-tailed deer in northeastern Ohio. The samples were taken between November 2021 and March 2022.

From 1,522 nasal swabs, 163 tested positive for alpha and delta variants of COVID-19. The researchers also found the virus had bounced many times back and forth between humans and deer.

Coronaviruses are covered in spikes, and it is these spikes that latch onto our cells to gain entry and begin replicating. The particular part of our cells that the spikes latch to is called the ACE2 receptor. This receptor is similar in deer and humans, and coronaviruses have lost little time in exploiting this.

Human contact with deer is common in parts of the U.S. and Canada, where many millions of white-tailed deer live as wild, urbanized or farmed animals. In these habitats, deer may be exposed to human waste. They can carry bacteria with similar antimicrobial resistance patterns to local humans.

The Ohio researchers found that COVID-19 multiplied and spread in deer over several months, causing no obvious illness or deaths in the animals. Migrating deer, males in particular, spread the virus as they moved across the landscape.

It is not known if other potential hosts (such as skunks, squirrels or rodents) contracted the virus too, but spread from deer back to humans was seen. How this exchange happened is unclear.

Deer sampled on Staten Island, New York, over the same period showed evidence of spillover infection from humans by another COVID-19 variant, omicron.

By measuring changes in the COVID-19 genomes in the deer, through use of a new statistical method, the researchers in Ohio estimated that the rate of viral mutation was three times greater than in humans.

The types of genetic changes were not the same as those in human COVID-19. The mutations appeared to be adaptive responses that might have increased viral spread in its new deer hosts.

The pathogen showed early increases in its diversity in humans, too, which was perhaps more rapid in the first years after 2019.

Crucially, the viral spillover from deer to humans has not caused new human outbreaks that are making doctors lose sleep. Evolutionary changes in COVID-19 in deer populations have not resulted in a virus that can evade our antibodies, so there is no current public health risk linked to this increased mutation rate.

As with humans, some deer are “super-spreaders.” Social network analysis shows this process in the animals’ use of scraping sites, where males leave their scents to set up breeding groups. Human-made feeding or bait stations (for hunting) exacerbate the rate of viral spread, too.

White-tailed deer could be referred to as a new reservoir of COVID viruses. Animal reservoirs encompass a continuous process of viral division and change.

Hosts impose selective pressures on viruses that influence the rate at which a virus’s genome changes. For example, influenza A evolves more rapidly in populations of birds or pigs than in people.

Probably, the lifespan of an infected animal, metabolic processes within its cells, immune actions, damage to viral RNA from host enzymes or other pathogens all force viral mutation. Whatever the reasons, these observations from Ohio raise the possibility that COVID viruses might develop into a new strain or variant capable of spreading significant illness to humans within those millions of North American white-tailed deer.

Blood tests of U.K. deer in 2020-21, in contrast, found no evidence of COVID-19.

This could be because British deer species have distinctive ecological niches and COVID susceptibilities.

It is clear that ongoing surveillance provides valuable intelligence.

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

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Last month, Campbell Soup struck a $2.7 billion deal for Rao’s sauce maker Sovos Brands (all figures US$). Unilever bought premium frozen yogurt brand Yasso in North America, while Snickers maker Mars acquired healthy foods maker Kevin’s Natural Foods.

“There’s been a nice uptick in M+A (mergers and acquisitions) in the food industry in the first half of the year…,” said Michael Milani, executive managing director and principal at advisory firm Baker Tilly.

“It has been a big theme, and we expect that to continue in the back half of 2023 and into early 2024.”

This is despite higher borrowing costs straining companies looking for acquisitions.

The value of deals in the U.S. food and beverage industry slipped nearly three per cent to about $10.39 billion this year, according to LSEG data. But their volumes climbed 17.5 per cent to 248 as of Sept. 1, making the industry a bright spot in dealmaking.

The total number of deals across all industry sectors slid four per cent in the same period, data showed.

“Large food companies need to add more new concepts, new flavour profiles and new food items because their old brands — though still growing — are not growing at a meaningful rate,” Milani said.

The rise in deals comes as volume of sales at companies such as Kraft Heinz and Campbell fell for at least the past six quarters due to weak demand, while benefits from price hikes also fade.

“I would expect there to be a continued drumbeat of M+A,” said Sarah Henry, managing director and portfolio manager at Logan Capital Management, which holds shares in PepsiCo and Mondelez International.

Packaged food companies “are now faced with some difficult comparisons on organic (sales) and are seeking some strategic, category-specific M+A targets that will propel them through the next few years,” Henry said.

Cheerios cereal maker General Mills has pinned M+A as a key goal in the coming years, with executives saying it is a “good environment for M+A right now.”

For Mondelez, bolt-on acquisitions are the way to go, the Oreo maker’s finance chief Luca Zaramella had recently said at a Barclays conference.

Last month, Reuters reported that Twinkies snack cakes maker Hostess Brands was exploring a sale and that Mondelez and Hershey could be in the race to buy it.

J.P. Morgan analysts said they could be eyeing Hostess to expand outside of North America.

“Most of the large cap packaged food companies have … diligently reduced their debt and improved their balance sheet (through the pandemic)…so they have the risk capacity and risk appetite to pursue large-scale acquisitions,” CFRA Research analyst Arun Sundaram said.

“These packaged food companies need to continue finding ways to stay relevant … And so one of the easiest ways to do that is through M+A.”

— Reporting for Reuters by Deborah Sophia in Bangalore.

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The reweighting, which Statistics Canada carries out every year, has historically had only a marginal impact on the headline number. The new basket weights will be applied to May’s inflation data, due out on June 27.

The rebalancing reflects changes in 2022 compared to 2021. StatCan said the alterations were designed to take into account the continuing recovery from the impact of COVID-19.

“Spending that began to gradually shift back towards pre-pandemic patterns in 2021 continued and were more pronounced in 2022, with several sectors inching closer to pre-pandemic basket weight shares,” it said.

COVID-related measures and disruptions to supply chains helped push Canadian inflation up to a near-40 year high of 8.1 per cent in June last year. It has now dropped to 4.4 per cent, still more than double the Bank of Canada’s two per cent target.

Gasoline prices, pushed higher by increased demand as well as Russia’s invasion of Ukraine, will now account for 4.27 per cent of overall inflation, up from 3.47 per cent.

Gasoline is part of the larger transportation component which, for the second consecutive year, increased the most among the major eight segments, rising to 16.94 per cent from 16.16.

The food component expanded to 16.13 per cent from 15.75 per cent, reflecting increases in sales at restaurants as lockdown measures were removed.

But the shelter component dropped to 28.22 per cent from 29.67 per cent, in part due to lower costs for rent and other accommodation expenses as the housing market cooled.

DVD players were removed from the 2023 basket as they have become less popular with consumers following the advent of streaming services. Conversely, charcoal barbecues and snow removal equipment were added.

— David Ljunggren is a Reuters political correspondent in Ottawa.

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He said Brazil and the U.S., where JBS has meat facilities, are well positioned to meet China’s growing demand for beef as the major food importer reopens after COVID-19 restrictions.

“It is structural the growth in demand for beef in Asia as a whole, especially in China,” the CEO said.

He added that China is competitive in chicken and pork production, since these have shorter cycles, while for beef there is a need for more land and the production cycle is longer.

“Urbanization, rising income, these increase consumption,” Tomazoni told reporters. “Changes in habits after the pandemic (also) leads to an increase in beef consumption.”

On Tuesday, the CEO of poultry and pork processor BRF, Miguel Gularte, said he was optimistic about China’s meat demand returning to normalcy after the Chinese New Year celebrations.

Tomazoni cited forecasts that by 2050 the world will have to produce 50 per cent more food to meet global demand, also pointing to population growth as a factor driving consumption.

— Reporting for Reuters by Roberto Samora; writing by Ana Mano.

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Pork output in the world’s top producer of the meat reached 55.41 million tonnes, the highest since 56.71 million tonnes recorded eight years ago. The 2022 output compared with 52.96 million tonnes in 2021.

Output was boosted by high fourth-quarter production of 13.91 million tonnes, according to Reuters calculations of the data from the National Bureau of Statistics. That was up 0.87 per cent from the same year-earlier quarter despite a shortage of slaughterhouse labour due to COVID outbreaks.

Farmers have raised heavier hogs, hoping to benefit from an anticipated recovery in demand and prices, a factor that could have boosted output.

Demand had, however, remained tepid due to surging COVID-19 cases in China that kept many people at home, causing prices to plunge.

The data shows that China’s pork production has increased every quarter year-on-year for the last two years despite sluggish demand.

“I haven’t heard there’s much storage so it needs to be consumed already, which is difficult to explain,” said a livestock analyst, declining to be identified because of the sensitivity of questioning official data.

A rally in prices over the summer encouraged farmers to fatten pigs up more than normal to increase their profits.

Though it has declined, the average weight of live pigs was still on the high side at about 124.5 kg last week, according to analysts at Huachuang Agriculture.

That will continue to pressure prices, they said in a note published Sunday.

Meat consumption is set to improve after China’s reopening from a strict three-year COVID policy, with more group dining and business gatherings to support demand.

However, some believe pork consumption may not recover to the levels prior to China’s African swine fever outbreak that began in 2018, with many still cautious about crowded gatherings.

China’s beef output increased last year by three per cent to 7.18 million tonnes, the data also showed, while poultry output rose 2.6 per cent to 24.43 million tonnes and lamb and mutton increased two per cent to 5.25 million tonnes.

— Dominique Patton reports on agriculture in China for Reuters from Beijing.

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But the price rally was capped by investors looking to capture profits and adjust their positions before the end of the year, traders said.

“They’re backing off on what they want to hold and carry over into the New Year, even with both the dollar and crude oil being down,” said Karl Setzer, brokerage research lead at Mid-Co Commodities.

“That normally would be giving the grain market a boost, but not today,” Setzer said.

Wheat and corn eased from multi-week highs struck in the previous session, as traders awaited a clearer assessment of frost damage to U.S. wheat crops and as mounting COVID-19 infections in China tempered demand hopes.

Some participants booked profits after the rally in grains that may have been amplified by thin holiday volumes, traders said.

The most-active soybean contract on the Chicago Board of Trade (CBOT) ended the day up two cents, settling at $15.16-1/4 a bushel (all figures US$).

CBOT wheat closed the day down 11-1/2 cents, settling at $7.74 a bushel, while corn eased down 3-1/4 cents at $6.79-1/2 a bushel.

Crude oil fell as a surge in COVID-19 outbreaks in China created concern about short-term disruption, even as investors saw potential for a demand upturn next year as the country re-opens.

Drought in Argentina, the world’s largest exporter of soyoil and soymeal, is threatening prospects for next year’s soybean harvest. After less than expected rainfall last weekend in the country’s main growing belt, attention has turned to showers forecast in the week ahead.

U.S. wheat markets remained capped by Russian competition in export markets, highlighted by a purchase of 200,000 tonnes of Russian wheat by Egypt this week.

— Reporting for Reuters by P.J. Huffstutter in Chicago; additional reporting by Gus Trompiz in Paris, Michael Hogan in Hamburg and Naveen Thukral in Singapore.

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Corn also found support from uncertain weather in South America, while wheat lifted as trade kept monitoring freeze damage in the U.S. Plains.

The most-active soybean contract on the Chicago Board of Trade (CBOT) gained 25-1/4 cents to $15.14-1/4 a bushel, the largest daily gain for a most-active contract since Nov. 11 and the first close above $15 since June 23 (all figures US$).

CBOT wheat firmed 11 cents to $7.85-1/2 a bushel, while corn added eight cents to $6.82-3/4 a bushel, after reaching $6.83-1/2, the highest level for a most-active contract since Nov. 4.

Soybean futures continue to swing on South American weather models that call for rainfall in Argentina’s parched growing region.

“The longer-range models promise a forecast of rain, but then we get to that time frame and we get very little,” said Brian Hoops, senior market analyst at Midwest Market Solutions.

The relaxing of health restrictions in China has extended to food imports, as checks have been lifted on imported chilled and frozen foods, beginning Jan. 8.

However, there was also caution in financial markets about the short-term impact of China’s COVID policy shift, with a surge in infections straining hospitals and prompting some countries to consider new rules for Chinese visitors.

Wheat rallied in the past week as extreme cold weather gripped the United States, threatening to hurt winter wheat crops already weakened by drought.

“Those types of rallies tend not to last more than a few days, but this one has lasted,” said Arlan Suderman, chief commodities economist at StoneX. “The fact that the world balance sheet is as snug as it is has picked up a little bit more interest in the overseas markets.”

Gains were capped as Russia-focused agriculture consultancy Sovecon raised its forecast for Russia’s 2022-23 wheat crop estimate to 101.2 million tonnes, up from the previous estimate of 100.9 million tonnes.

— Reporting for Reuters by Christopher Walljasper in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.

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Cattle futures were firm, with strength in the cash market underpinning prices.

Weakness in Chinese markets spilled over to CME hog futures. China’s most active hog futures contract closed down 6.6 per cent at its lowest level since it was launched almost two years ago.

Concerns about rising COVID-19 cases in China following the easing of virus-related restrictions in the world’s top consumer of pork pressured hog markets.

Boxed beef prices rose on Monday, with choice cuts gaining $8.09, to $257.02/cwt, while select cuts rose $4.42, to $225.68/cwt, USDA said (all figures US$).

CME February lean hogs dropped 0.3 cent, to 83.7 cents/lb., bottoming out at 82.8 cents, their lowest since Oct. 14. Nearby December hogs edged up 0.375 cent, to 81.95 cents/lb., in thin trading ahead of the contract’s expiration on Friday.

The CME’s lean hog index, a two-day weighted average of cash hog prices, eased 48 cents to $81.99/cwt.

CME benchmark February live cattle gained 0.55 cent, to 156.1 cents/lb., while the spot December contract firmed 0.725 cent, to 154.4 cents/lb.

CME January feeder cattle eased 0.275 cent, to 183.65 cents/lb.

— Mark Weinraub is a Reuters commodities correspondent in Chicago.

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“With such geo-political stuff going on and a possible railroad strike [in the United States], it kind of disrupts the flow,” he said.

Capinegro pointed to China and its ongoing struggles with COVID-19 outbreaks– and now a measure of civil unrest there, with protests against the stringent lockdown measures. He warned China might be trying to frontload before the country has its holiday season early next year.

“They can blow things out of proportion and make the markets break,” he said.

Also, if there is a railway strike in the U.S., even for a couple of days, “it would hurt a lot of things,” he said, as so many products are dependent on rail movement.

Another factor Capinegro said markets will keep an eye on is weather in South America — specifically, how it affects corn and soybean crops.

Also, he said to watch Mexico’s moves regarding its ban on genetically modified corn that’s scheduled to start in 2024. Capinegro noted there have been some sizeable sales of U.S. corn to Mexico recently.

“Buyers could put it in a bin and store it,” he said.

Despite all that’s going on in the world and within the U.S., Capinegro said corn will likely remain largely where it is, “but soybeans are closer to the upper end of a good trading range.

“This wheat break we have had over the last few days has really helped our price in the world,” Capinegro said, noting how little news there currently is of the war in Ukraine.

Capinegro said he expects that pattern to hold at the CBOT following the next supply and demand (WASDE) report from the U.S. Department of Agriculture on Dec. 9, stating “it’s not a real market mover.”

— Glen Hallick reports for MarketsFarm from Winnipeg.

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