Beef industry needs to dial back production

By Lee Hart

It doesn’t sound like Canada has hit a full-scale glut in beef production but it is getting close. So the message or recommendations across the beef industry is hold off on marketing cattle.

That message summarizes the situation described during a Canadian Beef Industry Town Hall meeting Wednesday afternoon. It

Fewer finished cattle needed until processors catch up.

is a message that largely applies to cattle feeders shipping to packing plants, but also applies to cow-calf operators who might be shipping cull animals to market — both beef and dairy producers.

For a number of reasons, all linked to the COVID-19 pandemic, beef processing capacity across Canada is down about 25 to 30 per cent right now, estimates Brian Perillat, manager at Canfax. That includes the most recent news from Cargill in High River, AB, which earlier this week shut down one of two shifts it has been running due to a COVID-19 outbreak among plant workers. It is estimated the layoff affected about 1000 workers on one shift, while “several hundred” employees continue to work on the other shift. On two shifts, the plant processes between 4,000 and 4,500 head of cattle per day, representing about 40 per cent of Canadian beef production.

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Along with the reduction in processing capacity in Canada, there have also been slowdowns involving at least a couple of the U.S. plants that process Canadian animals.

All factors combined, it just means the industry is very close (10 days to two weeks) away from the point where finished cattle will have to sit in the feedlot until there is processing capacity. So what has to be done?

SET ASIDE PROGRAM

 One of the main tools to slow the number of finished cattle is to activate a set aside program, says Fawn Jackson, director of government and international relations with the Canadian Cattleman’s Association (CCA). It was a tool developed during the BSE crisis of 2003, which largely involves cattle feeders switching feeder cattle to maintenance rations rather than high performance finishing rations. It slows the gain on a number of cattle sufficiently to allow the processors to keep pace the numbers that are finished.

Participants in the Town Hall meeting couldn’t estimate how much of a slow down in feeder/finished cattle numbers is needed. That will be determined by a governance committee that will manage the set aside program — evaluate processing capacity and then advise feeders on how many head to put on maintenance rations and for how long.

Along with the set aside program, Jackson says the industry is also working with the federal government to enhance risk management programs such as The Western Livestock Price Insurance Program (WLPIP) — a risk management tool available in British Columbia, Alberta, Saskatchewan and Manitoba, AgriStability and others.

 JOBS ARE OUT THERE

 And while so many sectors of the economy have slowed down or stopped due to the pandemic, there is a need for workers in the agriculture sector, says Janice Tranberg president of the Alberta Cattle Feeders and National Cattle Feeders Associations.

The agriculture industry hires between 50,000 and 60,000 skilled seasonal foreign workers annually, she says. So far about 15,000 workers have either arrived or are on their way. More are scheduled to arrive in Canada. But even with federal government assistance with the foreign worker program there is still a need for about 15,000 more workers, says Tranberg. The point being made, if anyone isn’t working and needs a job they may want to check out the agriculture job board.

Lee Hart is editor of Cattleman’s Corner based in Calgary. Contact him at 403-815-3719 or by email at [email protected]

 

 

 

 

 

 

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