What’s the fix for Canadian beef industry?

I  lied in one of my earlier blogs. I don’t have an effective, sure-fire, three-point solution for fixing the Canadian beef industry. But I am hoping some of the readers do and can send me their thoughts.

The search for a solution follows a conversation I had a couple weeks ago with Gary Etherington, a beef producer in the Dewberry area of northeast Alberta. He was processing calves that day, and although I think the processing went fine, he still didn’t have a very positive outlook on the Canadian beef industry.

It has been a dry year in his area, prices for calves are generally down this year, the dollar is up, hay is in short supply so winter feed costs are up, and generally there is no or little profitability for cow/calf producers. (Last year winter feeding costs penciled out to less than $1 per day, this coming winter it is closer to $1.50 per head per day.)

Country of Origin Labeling (COOL) in the US is having a very similar effect on the Canadian beef industry as BSE – it is closing the border to many Canadian cattle, which have been finished and processed by US feeders and packers. And a point, which has long been an issue of Etherington – one of the principals behind the now defunct Border Beef packing plant project – with only two primary beef processors in Western Canada, there is no effective competition in the Canadian packing industry.

Etherington, who is also a large animal veterinarian, sees what he describes as an exodus from the industry by many cow/calf producers. Many of the younger potential beef producers left a couple years ago to work in the oil patch and now it is the 40 and 50 and 60 year olds, tired of loosing money for the seventh consecutive year, who are quietly exiting the industry.

“A year like this is just the straw that broke the camel’s back, “ says Etherington. “Prices are low, hay is expensive, so a lot of producers aren’t even looking at figuring out how to feed cattle this winter, they are just getting out.”

 So what is the solution? What are your thoughts on the Canadian beef industry?  What has to be fixed? Have you figured out some way to fire-proof your operation from price volatility, and current market conditions? Post your comments here (your name doesn’t have to be used, but I would like to know who you are, so I can call if I have any questions). Send me your comments, and a contact number. Email them to: lee@fbcpublishing.com ; write them down and mail them to Grainews, Box 71150 Silver Springs PO, Calgary, AB T3B 5K2; or give me a call at 403-592-1964.

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